How I Budget My Money

Money has never been something that I have been shy about talking about here on my blog. Don’t get me wrong, I don’t talk about things like how much I have in the bank. But I will talk about how I earn money, how I manage money and how I invest money.

 

 

Because of my previous posts about money, I thought that it was time to add a new one to the collection. This one is all about how I budget my money. These are simple steps that I do to ensure that I look after my money, only spend what I can afford and also enjoy my money. So, if you want to learn about how I budget my money, keep reading.

 

Have an account for the household.

One thing that I cannot preach more about if you are a homeowner is to have a separate account for your home. Then everything that is to do with the home comes from one account and there is no confusion. This then helps to monitor your incomings and outgoings with ease as everything will be in one place. For my husband and I, we both have separate bank accounts where we have our individual money and then the collective household account. That is just what works the best for us.

 

Have a general savings account and save between 20% to 40%.

Since I started working, I have always had a general savings account. From my first day at work, my dad used to make me put away 40% of my salary into my savings account. As I got older and I began saving for a house, I reduced this down to 20%. But regardless, I have always ensured that I put something away each month. I understand that I am in a very fortunate position to be able to put money in savings each month. This is what then becomes my ‘fuck it’ money that I allow myself to spend on fashion, beauty, etc.

 

Have a document showing all incomings and outgoings.

My husband and I share a Google Doc which I manage. In this document it details all of our household bills, the reference numbers for those bills and the amount that they are. There is then a column which shows our incomings and from there is a formula which breaks down how much we each need to put into our household account, based on a percentage of our earnings to ensure that everything is covered. Within this, is also a line for what we put away in our joint savings each month. My document is complex, but really all you need is a detailed document showing your ingoing and outgoings and then you are done.

 

Consider large purchases into my budgeting document.

For general day to day purchases, I just buy things as I need them. However, if I am going to be making a purchase that is over a thousand pounds, I will consider it within the budget. By using my budgeting document, I can get a gauge on when is the best time to spend money. When I need to save money and when I need to simply say no to larger purchases. This can be anything from things for the house, new cars, holidays, etc. Anything that is an investment I will think of in this way.

 

As always, I hope you enjoyed reading this post about how I budget my money. I will never stop saying that I think that things like this should be taught in school. When will you ever need to know the cellular breakdown of a fucking leaf. But you will without a shadow of a doubt need to know how to budget and look after your money. Because of that, I hope that you read this post and took something from it. If you do feel like you need help, there are people out there that can give impartial and free advice to help people get on top of their own financial situations. Please leave me a comment below and let me know what you thought of this post.