Creating A Budget

Budgeting is probably the most un-fun thing to do, but for some reason I love it!

In basic terms it all about creating a plan and I love plans. Budgeting means I can plan for holidays and special purchases in the long run and the essentials on a daily basis.

Before I move into my house in the new year I have planned my budget in quite a bit of detail and caution. There are a lot of unknowns at the moment in terms of what things will cost, but I know what I have to pay for, such as:

  • Mortgage
  • Electricity
  • Gas
  • Water
  • TV License
  • Internet and Phone Line
  • House Insurance
  • Council Tax

All these (apart from the mortgage) I have had to pay while renting, so I have an idea of what things might cost, but have allowed more, rather than less.

After taking these out of my budget I looked at the regular payments I make (you could have more or less):

  • Swimming Club
  • Gym
  • Mobile phone
  • Food
  • Petrol
  • Car Insurance

What I have left is mine to spend as I want, but I always save a proportion of my monthly income. Now I will be owning my house I will need to stick to my budget much more strictly than I have had to in the past. I will need to account for maintenance and unforeseen expenses. So part of my savings will be going in a house account for such things.

I have been looking at where I can reduce my spending and food shopping and coffee shops are up the top of that list. Part of my plan is to start meal planning again so I know exactly what food I need to buy and cutting out those trips to the shops on the way home from work. this will be good for my bank account and my health as meal planning will make it easier for me to track my eating and lose weight.

I will also be making visits to coffee shops special occasions again. I have gotten into the habit of spending £3 on a coffee every few days, which could add up to £30 or more a month! So I want to take it back to a maximum of once a week and make it worthwhile, by scheduling it in as me-time to blog or read or just relax in my favourite coffee shop. No more take away coffee, unless it is home made!

Books and movies are also things I will have to reign in a bit. I will make sure I read the books I have before I buy any more. With my commute I will prioritise audio books over real books because I’ll have more time to listen, rather than read. I will also limit my cinema trips and the dvd’s I buy. I will focus on what I get with the TV and possible sign up to a streaming service. I have to change the way I think about them being a necessity to being a luxury.

There are other things that because I live at home I don’t much notice of because it’s my parents way of doing things. I will be monitoring my energy consumption and turning off plugs at the wall and ensuring I’m not unnecessarily heating my home. I think watching your behaviour at home can have a big impact on your bills and as I do it for a living it will be time to live the way I believe.

With budgeting everyone has different priorities. Mine is to pay all my bills first, then save for holidays and then spend my disposable income on the things I need and want.  I would like to get a pet once I’ve been in my house a while and then my priorities will have to change again to ensure I provide for them.

Having a good budget is also about be flexible and knowing when you have to say no. I think this will be hard to start with as I am used to having mostly disposable income, but I know it needs to be done as I do not want to get into debt. I will concentrate on doing the things I want to do and saying no to the things I don’t.

I am going to be broke a lot (for things I don;t want to do), but I will be in my own house and can do everything I love to do. I cannot wait!

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