How to Plan Your Monthly Household Budget


household budget

Budgeting… on a Budget

 Even though the living wage has just risen 20p in the UK to £7.85, the cost of living crisis that is affecting the vast majority of families across the UK is still in full swing. With the government doing all it seemingly can to make the lives of ordinary working people difficult, and focusing more and more of their resources on London, normal people are being economically strangled.

Despite the fact that apparently the UK is out of recession and back at its pre-recession levels of economic growth, the bottom line for working people is that life isn’t getting any easier. Are you feeling the crunch? If you are, then you’re not alone.

Although there’s no easy solution to the problems you and the vast majority of others here in the UK are facing, there are ways to make your life slightly less stressful, and one is appropriate budgeting. The issue is, many budgeting techniques these days aren’t free, making the process of budgeting require some budgeting in and of itself. So, what are some of the best ways to budget when you’re on a budget.


The Old-Fashioned Methods Still Work Best

Although there will be plenty of time to try new shiny methods of saving, when it comes to calculating what you need each month and setting money aside for it, there’s no better way to save than to use the old-fashioned methods your grandparents used to use.

One of the best of these sorts of methods is called the jam jar technique, and it essentially boils down to splitting your financial outgoings into categories (bills, monthly rail ticket, mortgage; rent etc.,) and then taking an envelope for each one (or old-fashioned jam jars if you’ve got them) and placing the agreed amounts in each one.

By splitting the money out in this way, you’ll know that you’ve accounted for all your expenses, and then whatever’s left in your bank account is yours to spend (or – even better – squirrel away).


Daily, Weekly and Monthly Budgeting

Although the above technique is a productive one if you want to get a good sense of how your financial situation is looking over the next full month, it’s essential that you get a grip of your finances on a tighter, more detailed time scale.

One way to do this is to view your budgeting on three separate levels: the monthly, weekly and daily levels. The monthly level we’ve already discussed (although there’s a lot of other advice about how to plan your monthly budget – like this for example), the weekly level allows you to split out your money into regular weekly spends as well as to set aside money for the precious weekend, and the daily levels allow you to analyze where you’re spending money on a day to day basis.


Stopping Yourself Spending Frivolously

It is those daily frivolous spends of a couple of pounds that all add up to much more than you’d like to know. Therefore, really getting a good view at your daily spending habits will make you a better daily budgeter. A great way to do this is to download a budgeting app for your phone that can show you precisely what you’re spending, and what you’re spending it on. Coming face to face with this sort of information can be shocking, and although most of these apps aren’t free, they’re extremely cheap for the (mostly) excellent functionality they provide.

So ultimately, budgeting doesn’t have to cost you an arm and a leg if you rely on traditional methods, view your budget at the three levels of the day, week and month, and if you supplement your old-fashioned methods with modern smartphone technology.





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