Understanding how and where you spend your money is key to starting your personal budget. It is better to know what you are spending than to suddenly get an unexpected credit card bill at the end of the month … so take control of your finances, its easier than you might think.
Tips to help you see what you’re spending money on
- Don’t make it too complicated, don’t worry about deductions already deducted from your pay cheque.
- Write down ALL purchases … such as those jeans that cost $150.00 😉
- Make a note of those treats you buy every day to get you through the afternoon.
- Read your bank statement carefully, especially if you use a debit card for most of your purchases. A credit card statement is easier as your purchases will listed.
Now that you are more aware of your everyday expenses, take it a step further
- Make a list of what you must be spending every month – The ‘MUST’ list
- Make another list of what you want to be spending on every month – The ‘WANT’ list
The Must list will probably be as follows:
Housing
- Rent or Mortgage
- Utilities
- Phone Bill
- Groceries
Transport
- Car Repayment
- Petrol
- Insurance
- Services
- Public Transport
Health Care Costs
- Medical Insurance
- Dental Plan
All other monthly payment and saving contributions. These expenses are known as fixed expenditure and are not optional.
The Want list will be more complicated:
Self Improvement
- Joining the Gym
- New clothes for work
- Furthering your education
Entertainment Purchases
- Dining Out
- Bars
- Movies
- New clothes
- Jewellery, accessories
Everyone spends money on entertainment but you can be careful. Most of the above purchases don’t feel worth it a week later. Saving a little extra each month will help you to start paying off your debts. Put aside enough each month to reduce your principal debt. Put more money towards paying the higher interest rate bills first.
Check your budget on a weekly basis to make sure you are staying on track. You will be surprised to see that doing without unnecessary purchases will build up your cash flow, so you can plan a vacation or simply save your hard earned money. It’s that simple – either earn more money, or spend less. Staying disciplined will be worth your while.
Here are some great tips to trim your entertainment budget:
- Split A Starter … or rather go out for lunch instead of dinner.
- Snack Before – Have a little snack before you go out.
- Sign up for Restaurant Deals. Use coupons for discounts or get buy one get on free.
- Skip the Cocktail. Rather go for a non alcoholic drink and save the cocktails for home
- Enjoy an evening at home. Spend the evening at home, invite family and friends for a game night or DVD night, make your own popcorn.
- Have a bring and share. Prepare a dish, and then ask everyone to bring either dessert or drinks. Or just have a snack evening with finger foods, chips, dips, veggie sticks, ice cream and cupcakes.
- Movies – There are also special deals where you can sign up for a ‘movie and meal special’ or just get a discount on movies. Matinee show times cost less. You could also just wait for the DVD to come out.
- Books – Join your local library instead of buying new books. You can also buy most books cheaper online, such as the Kindle Store (Amazon.com)
- Music – Purchase the one or two songs you actually like on an album on iTunes (or similar) instead of buying the entire album
- Cold Drinks – To save money on cold drinks when you’re out and about, simply carry a bottle of water wherever you go. This way you will not be tempted to buy fizzy drinks, juices or bottled water … it’s also a healthier option!
These are just a few strategies to help you budget for your entertainment and still enjoy life. Plan ahead and budget in advance for expensive entertainment activities.
Go to a park, a museum or art gallery, take a trip to the beach, or engage in other outdoor activities that do not put you over budget. Winter or Summer there are always fun to be had outdoors. Use coupons and look for promotions!
If you really do need a loan, reach out to our personal finance specialists at Speedy Finance. We follow responsible lending practices.