Do you ever get a feeling of dread when you go to check your bank balance?
Back in my uni days I got that sinking feeling whenever it came to thinking about printing a statement or checking my on-screen balance. It took a lot of courage to actually look for fear of what I might find! Sadly it didn’t improve much in the first few years of marriage – I happily (but sometimes naively) left Berno to keep an eye on things. Thankfully he did a good job otherwise we could have ended up in trouble, but I didn’t always appreciate his money saving tactics!
I think it’s fair to say he cut my chocolate intake by about 95% and on one occasion told me we hardly had any money so I didn’t spend anything! I should of been happy when I discovered we actually did have funds in the account – but I remember being pretty unimpressed!
It was different back then though – we were both working and although we didn’t really realise or appreciate it as much as we should of at the time – we had much more disposable income than we do now – oh the money we could have saved!
It’s only since giving up work to look after Heidi that I’ve had the motivation to really start managing our money. Maybe you can relate to some of my story or maybe you just want some ideas and inspiration for managing your money better. Here’s five tips to help you successfully stick to a budget:
Tip 1: Clarify your motivation
It was only when money got tight that I had the motivation to not only set a budget, but to monitor and stick to it. Why do you want to budget? What is your main motivation? Is it to save up for something specific? Or is it to simply get through the month?
Clarifying your motivation is key, as when temptation comes you’ll need this to help you focus. If you want to succeed at tracking your spending and sticking to a budget, you’ll need to be clear about why you are doing it. Maybe there are multiple reasons. Whatever your motivation, it might help to write it down or at least make a mental note of your main aim/s, and if you have them, your specific goals.
Tip 2: Find the best way to track and monitor your spending
If you want to succeed at sticking to a budget you need an effective way to track and monitor your spending. That might be simply using a notebook and pen, it might be using an online money manager, Excel, an app, or if you’re like us, a mixture of two. If you’re already doing this successfully, great! If you’ve tried one method but not stuck at it, work out why. What works for one person, won’t necessarily work for you.
When Berno looked after our money he used Lloyds Money Manager. I didn’t find it accessible or convenient to use, so looked for an app that I could use on the go, both on and offline and which had the functionality to sync across devices. Unfortunately the app I use (Spending Tracker) does not (yet) have a sophisticated budgeting tool, so I track all of our spending on the app (using my phone or tablet) and use Excel (on our laptop) for our budget.
I don’t actually mind as I like being able to track and analyse our spending in more detail on Excel. I’ve developed a system that works well for us and stuck with it for two years now. If you’d like to know exactly how this works in practice, let me know and I will explain in more detail in a future post.
You might need to try a few methods before you know what works best for you but it’s well worth it and essential if you want to stick at it!
Tip 3: Make sure your budget is realistic
Once you’ve found an effective way to track and monitor your expenditure, you can start to build a more accurate picture of how much you spend in each area or category. It’s hard to set a realistic budget without this info. I realised this after numerous attempts of setting a budget based on estimates and never sticking to it. It was only after tracking our spending over a number of months that I started to get a realistic idea of how much we actually spent on eating out, food shopping etc, and even then it varied some months due to one off events or unforeseen circumstances.
Don’t be discouraged and give up when you overspend, instead use the information to help you adjust your budget for the following month (or week) and overtime you will develop a more realistic budget.
Also, optimism is good, but you will quickly get discouraged if you are too optimistic and not realistic. Can you really manage to only spend £10 on food a week? Look through your budget and make sure its realistic.
Tip 4: Keep referring back to the budget and your overall aim
Being more aware of your spending will help you to make sacrifices when needed and make more informed choices. If you only look at your budget at the end of the month though, don’t expect to stick to it. Depending how often and how much you spend, you will need to keep referring back to the budget and check your progress. Again, this is largely about having an effective tracking & monitoring process in place that works for you, so if you are struggling to keep on top of your expenditure, then you may need to reassess how you’re tracking/monitoring it all and perhaps find an alternative method that suits you better.
By continually referring back to your budget you can make adjustments when necessary. As I mentioned earlier, each week or month is likely to vary depending on what comes up. Perhaps you get invited out for a meal and really want to go, but you didn’t know about it at the beginning of the month so didn’t budget for it. Can you cut down in other areas to allow you to spend a bit extra on eating out? Only you can decide how flexible you can or want to be with the budget you set each week or month, but by continually referring back to it you can make adjustments if necessary depending on your priorities and commitments.
When I started out I was quite rigid with our budget with little success. I’ve learnt to be more flexible and make adjustments when needed during the month, cutting back in areas so that we can be more liberal in others. We definitely haven’t mastered it yet and still overspend, but on the whole we are getting much better at sticking to a budget.
Tip 5: When you want to buy something, ask yourself; do I really need this?
Although sometimes you might be able to make allowances and readjust it during the week or month, often sticking to a budget will mean learning to say no, or not yet.
Since moving house I’ve really wanted to buy a load of storage jars for our kitchen. I’ve shopped around for the best price and know how many I’d like to buy, the only thing is that there isn’t room in the budget for us to buy them just yet. Other things have to take priority.
In the past, if there was money in the account I probably would have bought them, with little thought about what else needed to come out of the account.
Try to get into the habit of asking yourself if you really need to buy the item, or if it can wait for the time being. This may take conscious effort at the start, but like any habit you try to break or develop, the more you do it, the more natural it will become – so keep at it. It won’t take long before you find it easier to say no (or not yet) when it comes to spending money on things you don’t need, and for you to be more focused and purposeful with your spending.
Well that’s all for now. I hope this post has helped clarify what you need to do to successfully stick to a budget and be more focused with your money.
If you’ve found these tips helpful, have any further tips to add, or if you are interested to know how we track and monitor our spending in more detail, please do comment below – it would be great to hear from you!