How do you manage your spending?
Discussion
Hello,
Apologies if this has been covered.
I'm currently 23, I work for a good motor company and earn a more than decent wage for my age but somehow I still find myself counting pennies towards the end of the month.
I've had a look through my bank accounts and I can see that the reason I'm finding it hard to track what I spend/where my money goes is not because of big expenditures, but its because of those "small" purchases here and there. E.G. Pop to the shops, a quid or two here. Pick up some emergency groceries for parents now and then.. it all seems to add up and cause a bit of a dent in my wallet. Obviously that's not the only issue, I am a complete b*llend when it comes to spending and always get carried away.
My question is, how do you manage/track your spending? Do you put money away into savings at the start of the month when you get your pay, or at the end?
Do you take cash out every week, use an app, how do you do it?
I'm in a about 4k of CC debt from stupid student days which I dont seem to clear off as I always pay minimum balance because im always worrying if "Ill have enough" for the month. So I'm looking to make a financial change in the way I handle money
Any input is welcome.
Apologies if this has been covered.
I'm currently 23, I work for a good motor company and earn a more than decent wage for my age but somehow I still find myself counting pennies towards the end of the month.
I've had a look through my bank accounts and I can see that the reason I'm finding it hard to track what I spend/where my money goes is not because of big expenditures, but its because of those "small" purchases here and there. E.G. Pop to the shops, a quid or two here. Pick up some emergency groceries for parents now and then.. it all seems to add up and cause a bit of a dent in my wallet. Obviously that's not the only issue, I am a complete b*llend when it comes to spending and always get carried away.
My question is, how do you manage/track your spending? Do you put money away into savings at the start of the month when you get your pay, or at the end?
Do you take cash out every week, use an app, how do you do it?
I'm in a about 4k of CC debt from stupid student days which I dont seem to clear off as I always pay minimum balance because im always worrying if "Ill have enough" for the month. So I'm looking to make a financial change in the way I handle money
Any input is welcome.
For a start, set a budget.
Show what you having coming in every month, how much your fixed outgoings are - include a repayment for your CC in that.
From there, you'll see how much you have left to play with, and can set a spend limit from there really.
The above is essentially what I did to clear £2000 of overdraft & £4000 of credit card debt.
Need to make sure you have the self discipline to not go over your self imposed spend limit.
I also had a second account I used for day to day purchases, which I'd put whatever amount of money Id allowed for the week in to, and use that to buy with. Again, need to be disciplined enough not to just top it up if you run out of money.
Show what you having coming in every month, how much your fixed outgoings are - include a repayment for your CC in that.
From there, you'll see how much you have left to play with, and can set a spend limit from there really.
The above is essentially what I did to clear £2000 of overdraft & £4000 of credit card debt.
Need to make sure you have the self discipline to not go over your self imposed spend limit.
I also had a second account I used for day to day purchases, which I'd put whatever amount of money Id allowed for the week in to, and use that to buy with. Again, need to be disciplined enough not to just top it up if you run out of money.
I have my pay go in on the 28th and as many of my DD's including those into savings accounts come out in the few days after. I've then got a spreadsheet that lists all my different fixed commitments for the month including food, petrol, snacks at work etc how much that is and if there's a date that money goes out on. deduct all the costs and amounts transferred to savings from the income and the rest is mine to waste, anything left over at the end of the month goes into savings. it's a bit sad/nerdy but i was crap with money when i was younger and this helped me get some control of it
As above, set up a simple spreadsheet with your monthly outgoings and your income so you can see how much disposable income you have.
From there you can make projections on cash flow and put big things in like car insurance renewal etc.
Then decide how much you are 'happy' with spending per month on crap. Take that money out in cash at the start of the month so once it's gone it's gone.
This way you can decide how much you want to save per month and adjust the crap budget accordingly.
Simple but it works for me.
From there you can make projections on cash flow and put big things in like car insurance renewal etc.
Then decide how much you are 'happy' with spending per month on crap. Take that money out in cash at the start of the month so once it's gone it's gone.
This way you can decide how much you want to save per month and adjust the crap budget accordingly.
Simple but it works for me.
This is roughly how I do it:
Three bank accounts (Main, Bills & Savings) & 1 Credit Card, Salary gets paid into the 'Main' account.
Work out how much / month goes on 'regular' expenditure, rent / mortgage, bills, insurance, loan payments, phone contract etc.. (call this amount 1)
I pay this amount (rounded up a bit) into the bills account which all the bills etc come out of on DD. The balance in this account is left to accumulate as a rainy day fund.
Then subtract that amount from monthly salary. Remember this number - that's my upper limit on monthly spending. (call this amount 2)
Any money I do spend goes on a credit card (which gives you nice monthly statements, so you can clearly see how much you spend / month), Rarely do I spend cash, but that comes out of the main account.
Keep your credit card statement + any cash you take out under whatever amount 2 is..
That's basically it..
Each month, any money left over in the main account after bills money & credit card is paid off goes into the savings account.
Make sure you are honest & thorough when you work out amount 1 & make sure you keep any extra spending below amount 2.
Hope that helps..
Three bank accounts (Main, Bills & Savings) & 1 Credit Card, Salary gets paid into the 'Main' account.
Work out how much / month goes on 'regular' expenditure, rent / mortgage, bills, insurance, loan payments, phone contract etc.. (call this amount 1)
I pay this amount (rounded up a bit) into the bills account which all the bills etc come out of on DD. The balance in this account is left to accumulate as a rainy day fund.
Then subtract that amount from monthly salary. Remember this number - that's my upper limit on monthly spending. (call this amount 2)
Any money I do spend goes on a credit card (which gives you nice monthly statements, so you can clearly see how much you spend / month), Rarely do I spend cash, but that comes out of the main account.
Keep your credit card statement + any cash you take out under whatever amount 2 is..
That's basically it..
Each month, any money left over in the main account after bills money & credit card is paid off goes into the savings account.
Make sure you are honest & thorough when you work out amount 1 & make sure you keep any extra spending below amount 2.
Hope that helps..
Interest on £3,000 of CC debt is expensive
Look at transferring to a zero interest card (http://www.moneysavingexpert.com/credit-cards/balance-transfer-credit-cards) or borrowing the money elsewhere.
Then leave your cards with someone trustworthy and live using cash until it's paid back
Look at transferring to a zero interest card (http://www.moneysavingexpert.com/credit-cards/balance-transfer-credit-cards) or borrowing the money elsewhere.
Then leave your cards with someone trustworthy and live using cash until it's paid back
Reading the above posts, the recurring theme is keep:
Salary > fixed expenses + random purchases
The first two are relatively simple to calculate, but keeping on top of the random purchases can be tricky.
Its something I used to struggle with, but I find spending on a credit card helps, because every month I get a statement which is a clear total. And you can check it during the month to see if you're on track or need to wind it in.
Salary > fixed expenses + random purchases
The first two are relatively simple to calculate, but keeping on top of the random purchases can be tricky.
Its something I used to struggle with, but I find spending on a credit card helps, because every month I get a statement which is a clear total. And you can check it during the month to see if you're on track or need to wind it in.
Thanks for the replies.
I do have a spreadsheet set up but I find it never works out to plan - Mainly because I just tend to top up my "spending" account whenever I run low so it all goes out of hand..
Ill give you the details of my expenditures and how I manage it, so if there are any suggestions to improving it would be good.
Monthly income: £2000
Fixed bills (Includes phone, rent, AND my CC MINIMUM repayments): £950
Fuel: £280
Food/Socialising/Spending: £300
Cigarettes:£160
Left over: £310 - I never seem to see this money..
What I do is, I take £300 out and put it into my secondary current account for spending. I put Fuel money into a seperate account and then bills go out of my main account.
I think what I get most stressed about is the constant thinking "will I have enough money to last me". Im always calculating how much I have left vs days left till payday and this in itself gives me a headache so I always wind up paying minimum on my CC's and Im left nowhere.
As for the 0% balance transfer. Credit history is absolutely terrible and nowhere will accept me. The debt is spread over 3 different CC's @ £1000 each.
I do have a spreadsheet set up but I find it never works out to plan - Mainly because I just tend to top up my "spending" account whenever I run low so it all goes out of hand..
Ill give you the details of my expenditures and how I manage it, so if there are any suggestions to improving it would be good.
Monthly income: £2000
Fixed bills (Includes phone, rent, AND my CC MINIMUM repayments): £950
Fuel: £280
Food/Socialising/Spending: £300
Cigarettes:£160
Left over: £310 - I never seem to see this money..
What I do is, I take £300 out and put it into my secondary current account for spending. I put Fuel money into a seperate account and then bills go out of my main account.
I think what I get most stressed about is the constant thinking "will I have enough money to last me". Im always calculating how much I have left vs days left till payday and this in itself gives me a headache so I always wind up paying minimum on my CC's and Im left nowhere.
As for the 0% balance transfer. Credit history is absolutely terrible and nowhere will accept me. The debt is spread over 3 different CC's @ £1000 each.
Darko92 said:
I just tend to top up my "spending" account whenever I run low
Stop doing this...Edit to be slightly more constructive.. You seem to have done the maths & know what your ins & outs are.
You say "should" have £310 / month left over. Either your maths is out or this is what you transfer into your "spending" account and it gets spent.
Unless you exercise discipline no amount of fancy strategy to manage your money will help.
Have you considered paying £100 to each of the 3 credit cards when you get paid? (You can make over payments at any time - doesn't need to be when the payment is due).
Edited by oOTomOo on Thursday 10th September 15:19
Also, that's a lot of fuel, is that just commuting? I usually siphon off a part of my salary as soon as it comes in - it focuses the remaining spending when you look in your account and see it getting low.Self imposed spending limits are realistically the easiest/simplest way to do it.
You sound a lot like me OP, I'm 22 and don't have many big bills, £250 for a car and £220 for my mortgage are the largest, there are obviously gas, electric etc on top of that. I was also doing 20k a year in a 23mpg petrol car
I always used to find myself skint at the end of the month, and like yourself it was all the little £5ers here £10ers there that added up!
I was then signed off for 8 weeks with a bad back and due to being with my company less than 3 years (served apprenticeship with them which didn't count
) I was only eligible for half pay. It was a shock and a constant worry, but by limiting my self to £100 a week spending money I managed to get by (had to swap the car for something cheaper to run unfortunately) and I'm now on a better wage again and things have gotten easier.
Also, im not much of a drinker but is £300 on going out/socialising necessary? Would £200 be possible? You could surely manage two good nights on that? 3 pretty decent ones!
You sound a lot like me OP, I'm 22 and don't have many big bills, £250 for a car and £220 for my mortgage are the largest, there are obviously gas, electric etc on top of that. I was also doing 20k a year in a 23mpg petrol car
I always used to find myself skint at the end of the month, and like yourself it was all the little £5ers here £10ers there that added up!
I was then signed off for 8 weeks with a bad back and due to being with my company less than 3 years (served apprenticeship with them which didn't count
) I was only eligible for half pay. It was a shock and a constant worry, but by limiting my self to £100 a week spending money I managed to get by (had to swap the car for something cheaper to run unfortunately) and I'm now on a better wage again and things have gotten easier. Also, im not much of a drinker but is £300 on going out/socialising necessary? Would £200 be possible? You could surely manage two good nights on that? 3 pretty decent ones!
skene said:
Self imposed spending limits are realistically the easiest/simplest way to do it.
You sound a lot like me OP, I'm 22 and don't have many big bills, £250 for a car and £220 for my mortgage are the largest, there are obviously gas, electric etc on top of that. I was also doing 20k a year in a 23mpg petrol car
I always used to find myself skint at the end of the month, and like yourself it was all the little £5ers here £10ers there that added up!
I was then signed off for 8 weeks with a bad back and due to being with my company less than 3 years (served apprenticeship with them which didn't count ) I was only eligible for half pay. It was a shock and a constant worry, but by limiting my self to £100 a week spending money I managed to get by (had to swap the car for something cheaper to run unfortunately) and I'm now on a better wage again and things have gotten easier.
Also, im not much of a drinker but is £300 on going out/socialising necessary? Would £200 be possible? You could surely manage two good nights on that? 3 pretty decent ones!
Haha you sound like me there! - £300 is not just going out, its daily spending for food at work, coffees, work-lunches, dinners out, groceries for mum and dad now and then and so on. I always seem to have to top it up too!You sound a lot like me OP, I'm 22 and don't have many big bills, £250 for a car and £220 for my mortgage are the largest, there are obviously gas, electric etc on top of that. I was also doing 20k a year in a 23mpg petrol car
I always used to find myself skint at the end of the month, and like yourself it was all the little £5ers here £10ers there that added up!
I was then signed off for 8 weeks with a bad back and due to being with my company less than 3 years (served apprenticeship with them which didn't count
) I was only eligible for half pay. It was a shock and a constant worry, but by limiting my self to £100 a week spending money I managed to get by (had to swap the car for something cheaper to run unfortunately) and I'm now on a better wage again and things have gotten easier. Also, im not much of a drinker but is £300 on going out/socialising necessary? Would £200 be possible? You could surely manage two good nights on that? 3 pretty decent ones!
I should really quit smoking as well, It does make a dent.
Fuel is not flexible. Its for work (100 mile daily commute) in a diesel. So changing car isnt possible/needed, it runs well and doesnt cost me much.
No I live with parents, but I cover some of their costs rather than pay rent. So I pay about £400 per month towards their bills etc. That can't be changed as it's an agreement between me and them and I don't want to go back on it.
I live bang in the center of London so everything is damn expensive, and the people I work with are all high earners but as Im a new graduate entry, I earn less but have to keep up with their lifestyle when on work-events etc.
Would be much easier to manage if I could put my debt all into one place but unfortunately, doesnt seem to be possible. Cant get accepted.
I think the idea of not allowing myself to top up my spending budget is one I should stick to - Intend to give up the smokes soon too, they're doing me too much harm
I live bang in the center of London so everything is damn expensive, and the people I work with are all high earners but as Im a new graduate entry, I earn less but have to keep up with their lifestyle when on work-events etc.
Would be much easier to manage if I could put my debt all into one place but unfortunately, doesnt seem to be possible. Cant get accepted.
I think the idea of not allowing myself to top up my spending budget is one I should stick to - Intend to give up the smokes soon too, they're doing me too much harm
have you checked the DD's that are going out of your account ? if there are ones that you don't understand the name ring your bank and query them, there could be old mobile contracts etc still going out.
make your own lunch, its not exciting but saves a few bob.
you need to go through your bank statements with a fine tooth comb and mark up which is food, fuel, DD's etc and then find the £310.
make your own lunch, its not exciting but saves a few bob.
you need to go through your bank statements with a fine tooth comb and mark up which is food, fuel, DD's etc and then find the £310.
I developed a spreadsheet which has been improved over time. Basically I check my online banking every week day and copy and paste the contents into a "month" tab. I have all my outgoings listed and have a column for petrol, spending, shopping and other stuff that varies from month to month.
The last tab is an overview. I have my budget set and the "actuals" correspond to the month sheets. I can keep a check on things that are apporaching budget. If I've spent £200 on shopping and I'm half way through the month and my budget is £300, then I know it's time to do a weekly shop in Aldi for a change. Anything that is more than my budget automatically flags in red so I can see right away if there's an overspend.
I still go over budget but at least I know straight away and why. A bit nerdy maybe but it's the best way for me not to go nuts and I've often reigned in my personal spend as a result.
The last tab is an overview. I have my budget set and the "actuals" correspond to the month sheets. I can keep a check on things that are apporaching budget. If I've spent £200 on shopping and I'm half way through the month and my budget is £300, then I know it's time to do a weekly shop in Aldi for a change. Anything that is more than my budget automatically flags in red so I can see right away if there's an overspend.
I still go over budget but at least I know straight away and why. A bit nerdy maybe but it's the best way for me not to go nuts and I've often reigned in my personal spend as a result.
Ive got the spreadsheet, albeit not as accurate as above but I shall work on it.
I have been told to make food at home, it probably is something I need to incorporate.
Things get a little gloomy when you realise that you're never really able to stop worrying about money. Im constantly trying to figure out if Ill have enough and very rarely do I enter a new month with a balance greater than £100 in my account.
I wonder if I can speak to the CC companies and try and work something out? Managing different credit cards is quite stressful and because theres a few of them, Im just always paying minimum
I have been told to make food at home, it probably is something I need to incorporate.
Things get a little gloomy when you realise that you're never really able to stop worrying about money. Im constantly trying to figure out if Ill have enough and very rarely do I enter a new month with a balance greater than £100 in my account.
I wonder if I can speak to the CC companies and try and work something out? Managing different credit cards is quite stressful and because theres a few of them, Im just always paying minimum
I've always used cash draw out £100 at the start of every week it's a lot easier to keep track if what your spending day to day.
£400 towards your parents bills is very generous of you.
You also say it's difficult keeping up with your peers spending. They have more disposable income than you. Can you be the designated driver? We used to buy the DD's drinks of a night so it's a free night out for them.
£400 towards your parents bills is very generous of you.
You also say it's difficult keeping up with your peers spending. They have more disposable income than you. Can you be the designated driver? We used to buy the DD's drinks of a night so it's a free night out for them.
Have you tried one of those vaporisers? A friend of mine has switched to one of those and spends a lot less! Initial outlay was about £50 and then hes about £20 a month for fluid!
Making lunches at home isn't exciting (in actual fact its boring!) but it does help.
ETA £400 to help with bills is a lot! But I live in Scotland where I bought a two bedroom house for £60k so my ideas are a bit skewed
Making lunches at home isn't exciting (in actual fact its boring!) but it does help.
ETA £400 to help with bills is a lot! But I live in Scotland where I bought a two bedroom house for £60k so my ideas are a bit skewed
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