Technology can be a catalyst for change, especially around budgeting. There are free apps with built-in budgeting tools to give you a clearer picture of your finances.
Although it can seem tricky to start with, sticking to a budget can make a big difference. Here are some of the main things to know when beginning to budget:
Categorise your spending
Understand monthly spending and see where your money goes. You can use a budgeting app to receive different graphs, compare your current and past spending, as well as track where most of your money is going.
This can help you understand spending by category and check where you might have spent more or less than expected. It’s especially helpful when looking at big categories such as rent, bills and utilities.
Categories show you where you’re spending the most money and if there’s room to cut back. It also means you’re less likely to forget a payment that’s due and have to shell out unexpectedly.
Make a detailed plan
You can use budgeting apps, such as Auden Money, to help you to make a reliable plan that works by setting goals and challenging yourself to spend less.
One of the most useful features is matching your budgets to payday, as well as taking note of any upcoming, one-off payments (you could put a family member’s birthday into your budget for that month, for example).
It always helps to track your spending
throughout the month as you go.
Track as you go
It always helps to track your spending throughout the month as you go. That might mean sitting down once a week to see if you’re meeting your goals.
Staying on top of your spending habits can easily help you spot where you’ve gone over or under budget, so you can adjust your spending for the rest of the month. If you’ve spent more than you planned on your food shop, catching it early means you can adjust your plan to spend less on things like leisure items for that month.
Coming under budget is also a good thing to spot — it’s almost like finding a fiver you forgot in your jeans pocket. You might add that money towards a rainy day fund or something you’ve been saving for.
Set a savings goal
When you start living by your plan, it might seem like budgeting restricts your spending habits. But actually, it puts you in control of your money, helps you spot problems early and opens up opportunities for you to save.