Planning a whole month's spending sounds hard. But it helps you keep track of how your income compares with your expenses. That way you can keep your monthly spending and your budget under control.
Ways to plan your spending:
Work out your monthly income
The first step in planning a monthly budget is working out your income. This sets the upper limit for your monthly spending. You can count your regular income, such as your salary, and leave irregular income out of the calculation.
Start by keeping a record before you plan your budget.
To get a clearer picture of your monthly spending, check your expenses in your online banking or ask your bank for a statement, and write down what you spend. This makes your budget easier to plan.
Track your spending
Budgeting isn't only about keeping money aside for necessities. It's about dividing up your money in a way that suits you and building up savings. Look at how much you spend on what, and work on cutting unnecessary expenses (sweets, soft drinks, small snacks and so on).
Split your budget
Try following the 50/30/20 rule and splitting your budget into 3 categories by priority. Spend 50% of your monthly income on essentials, 20% on savings and 30% on wants to keep your finances balanced.
Essentials include necessary costs such as housing, your phone and car payments.
Savings include deposits, an emergency fund, investments and the like.
Wants cover things that aren't essential but that you'd like to do, such as eating out, travelling, shopping and going to the movies.
Update your budget regularly
After a while, something in your life may change. Based on those changes, update your budget every six months or once a year.
As prices rise, knowing what you're spending more on and keeping track of it matters more than ever. If you want to build a habit of tracking your spending, set up the expense-tracking habit in HabiDo and start taking responsibility for your finances.
This information on building healthy financial habits is brought to you by HabiDo and Zeely.
