Household Budgets Debt Consolidations

There is a popular saying amongst financial planners, it doesn't matter how much you earn it matters how much you save and then invest. The discipline of saving all starts with a budget that identifies how much you are earning and what you spend your money on. Once you know where the money is going you can then identify non-essential items and reduce your spending.

The key to managing a household budget is working out:

  • How much money you have coming in each month
  • What do you spend your money on
  • What expenses are essential
Essential and non-essential items

You can only manage what you monitor so the starting point is to identify where you spend your money. Begin by identifying essential living costs like rent, phone and food expenses. From there make an allowance for emergencies including dental and medical bills, car maintenance and other annual costs including insurances. Most of these costs are essential so you then need to identify non-essential costs or luxuries including entertainment costs, lavish overseas holidays and designer clothes.

Budgeting means you can:

  • Monitor your spending habits - identify what you spend your money on and quantify the amount
  • Break down your living costs into essential and non-essential costs
  • Prepare for emergencies and unplanned expenses
  • Save for special items - car, TV or holiday
  • Plan the family spending on each expense category and break the costs down into monthly or weekly amounts

Remember, a budget is a written plan that helps you track your income and expenses. It also lets you forecast your future expenditure and compare your actual expenses against your budget. Of course, for a budget to work you need to follow it!

Tips On Managing Your Bills

Some services like the telephone give you the option of monthly or quarterly billing. Spread these bills across the periods so you don't need find a large amount sum of money in a particulkar month so this could mean paying some bills monthly and others quarterly.

Plan the payment of your bills including your rent so you don't end up in dispute with the landlord or agent. If you leave your bills outstanding, you may incur a penalty and it may even affect your credit rating.

If you're having trouble paying a bill, call the supplier and explain your circumstances and ask for an extension of time. Be pro-active and make them aware of your situation rather than have them chase you when the amount is overdue. You might even negotiate a repayment plan.

How We Can Help You

Over the years we have helped a number of clients prepare household budgets as well as financial budgets for their business. To assist our clients we have produced a household budget template that you can download by clicking here and if you need help please don't hesitate to contact us.

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