Start with the simple truth
Stop overcomplicating things. The most effective budget is the one you actually stick to. You don’t need fancy software; you just need to know what’s coming in and what’s going out.
Get ready in 3 steps:
- Income first: List every source of income you have. Keep it simple and clear.
- Fixed expenses: List everything that stays the same each month: rent, mortgage, loan payments, phone bill, subscriptions.
- Variable expenses: Track what changes each month: food, fuel, entertainment. This is where most people lose track. Use your banking app to quickly categorise your spending for the last month.
Pay yourself first (the golden rule)
This is the key to building healthy money habits. Once you know your income, the first expense you pay is your saving or investing goal. Set up an automatic transfer for the day you get paid. The money is gone before you can miss it.
This small, consistent action is empowering. It means your dream holiday or your first home deposit is being built automatically. This is where the magic of compounding begins – even small amounts grow over time.
The power of ‘why’
Don’t just save money; save for a purpose. Giving your savings a clear name – like ‘Future Apartment Fund’ or ‘Sabbatical Savings’ – makes it much easier to stay motivated.
When you’re tempted by an impulse buy, ask yourself: Is this purchase worth more than the freedom and peace of mind my savings goal will give me? Focus on outcomes, not products.
Remember, budgeting is about making choices that align with your biggest ambitions. You’re not being cheap; you’re being smart. You’ve worked hard for your money, now make sure it’s working hard for you.
We do not offer personal financial advice or make specific recommendations based on your individual circumstances. If needed, seek independent financial advice before making decisions regarding your financial goals.