If you struggle to make ends meet a lot of the time, you may want some help. It can be stressful if you have to worry about money every month and wonder whether you will have enough to keep you going. However, if you set a budget it might help you to manage better.
What is a budget
A budget is where we allocate money for different spending purposes. The idea is that if we know how much we can spend on different things, then we will not overspend and be in the situation where we do not have enough money available. Obviously, we need to be flexible as sometimes we have more expensive months than others but setting a budget is a good start. It also helps us become more aware of what money we spend on what so we can see where most of our money is going.
Start with essentials
It is a good idea to start with looking at your essentials which means thing that you need. This would be things like your rent or mortgage, loan repayments, utilities, food etc. Anything that you need to either survive or have a basic lifestyle. These are the items that you need to prioritise and therefore you need to start by identifying what these things are and how much you pay for them. Once you have done this, then you can look at all of the other things that you buy and think about whether these are necessary or not. Consider whether you really need them and how much money you have left to spend on them. It might be that you will need to cut down.
See if you can spend less
It can be a good idea to also see whether you can spend less money on the things that you buy. For example, you need to think about whether you could switch retailer, providers or suppliers and pay less. We can often do this with utilities, contracts, insurers and even lenders so we do not pay as much. Investigate every item you buy and think about whether you might be able to save a significant amount of money if you bought it elsewhere.
See what is left
Once you have done this you will be able to properly see how much money is left to spend on luxury items. It can really help if you set up a direct debit to pay your bills off when you first get paid. Then, when you check your bank balance, you will know that everything that you have left will be there to spend on luxury items. There will be some exceptions, things like groceries tend to be bought more often than monthly so you will need to make sure you have enough for this as well as transport, perhaps petrol for the car or public transport costs.
However, once you are sure that all of the necessities are paid for, you will be in a position to be able to decide what else you want to buy. Hopefully there will be some money left over to get some luxuries. Of course, you may find that you will not have enough to buy all of the things that you want and therefore you may need to save up or go without some items. However, by doing this, you will be more in control of your money and be able to make sure that you can make ends meet each month. You will be in the position where you are able to make decisions about what to spend and what not to so that you make sure that you always have enough money for the things that you need.