During these difficult times, it is important to take control of your budget. While it might seem impossible to live on what might seem like a shoestring, we can prioritize our expenses and get what we need without making much sacrifice. Here are a few tips that can help you stay out of trouble and finish the month alive and well.
Write down your budget
How much money do you have right now? Include and specify your capital at the start of the month. Write down what’s on each one of your debit cards, savings accounts, wallets, pockets, piggy-bank savings, even under your mattress if you keep cash there. Never underestimate your spare change. In times like this, every pence is worthy. Make sure you know how much you have in total. It might be more or less than you imagine.
Categorize your needs
What do you need to get this month? Write it down, and divide it into categories. Include the rent or mortgage of your household, utilities such as electricity and water, communication services such as mobile plans and broadband, groceries, transportation, and anything else you can think of.
Create a budget for each category
How much are you spending on each category? If you have a steady amount you have to pay each month, for instance, as part of your household rent or your gym membership, it will be easier to write it down first. If you have noticed monthly patterns on other services and things you spend on, write it down but be aware it might change in the end. Stay informed of the increase and decrease of prices for services such as petrol or bus fares, and beware of any excessive use of entertainment and communication services that might incur additional costs. For example, hiring a film on Pay-Per-View or talking too much on the phone.
Here comes the hard part: priorities
What do you need more than anything else? Number each category in order of importance. Yes, that weekly shopping trip downtown is fun, but being evicted? Not so much. So rent and mortgage go first. That spa break feels like heaven, but your insurance can literally save your life. Your indispensables go first. Pay them as soon as possible. Your other utilities go next, as things would be difficult without being able to shower or turn on the lights. Next on the list are communication or work-related expenses.
Your phone bill and your metro card are essentials if you do not want to end up stranded in the middle of nowhere with no way to phone for help. Food is important, but you need to limit your grocery budget to basic items and use ways to save such as coupons and cheaper brands. Entertainment and luxuries come last. Think of them as weekly or monthly rewards after all your hard work.
Sure, it might seem tough to have to let a few things go. Nevertheless, life becomes so much easier once you have secured your basic needs.