Regardless of whether you earn 15,000 or 150,000 you still need to effectively manage your money. A budget is the most fundamental and effective financial management tool available to everyone and it doesn't cost a penny to create.
If you are comfortable with computer programmes then you can create a computerised budget using spreadsheets. If you prefer the pencil paper method then this works just as well.
Essentially a budget can help to show you how much money you have to spend and where you are spending it. Once you have a clear picture of your finances you can then identify areas where you could cut costs and then consider what to do with the savings.
Effective budgeting allows you to save money for the future and also helps you to avoid accruing debts. If you have debts to pay off then a budget will help you to work out how much you can afford to pay back and over what time period.
In order to create your own personal budget you should start by listing all of your outgoings. Monthly bills are an easy place to start; gas, electricity, council tax and rent are all examples of essential monthly costs. You could check recent bank statements and household bills to make sure you get an accurate picture.
The next expenses to detail are everyday costs such as like food, clothes and petrol. Remember to include everything, no matter how small.
Lastly you should try to include occasional costs like Christmas and birthday presents, car repairs, dentist and optician bills and any holidays. To get a weekly or monthly total of all outgoings simply add all costs together and divide by either 52 or 12.
The next step in the budget process is to list all of your income including any child tax credits, benefits or one off bonuses or payments. You can look at payslips to get an accurate figure and then calculate your weekly or monthly income amount.
Now all you need to do is subtract expenditure from outgoings and you can then clearly see if you have any spare money or if you are over-committed. If you have money leftover then you can plan what to do with it and if you are overspending then you can take action to balance your finances.
Securing a loan could be one way of consolidating and eradicating debt. Knowing how much you are overspending helps you to work out how much you need to borrow and therefore pay back.
There are several types of loan calculator available online which help you to determine the interest payable on a loan over your chosen repayment period.
By calculating loan payments you can work out the total sum to be repaid and the total interest you will pay, giving you a crystal clear picture of your finances and how they will stand in the future.
If you are comfortable with computer programmes then you can create a computerised budget using spreadsheets. If you prefer the pencil paper method then this works just as well.
Essentially a budget can help to show you how much money you have to spend and where you are spending it. Once you have a clear picture of your finances you can then identify areas where you could cut costs and then consider what to do with the savings.
Effective budgeting allows you to save money for the future and also helps you to avoid accruing debts. If you have debts to pay off then a budget will help you to work out how much you can afford to pay back and over what time period.
In order to create your own personal budget you should start by listing all of your outgoings. Monthly bills are an easy place to start; gas, electricity, council tax and rent are all examples of essential monthly costs. You could check recent bank statements and household bills to make sure you get an accurate picture.
The next expenses to detail are everyday costs such as like food, clothes and petrol. Remember to include everything, no matter how small.
Lastly you should try to include occasional costs like Christmas and birthday presents, car repairs, dentist and optician bills and any holidays. To get a weekly or monthly total of all outgoings simply add all costs together and divide by either 52 or 12.
The next step in the budget process is to list all of your income including any child tax credits, benefits or one off bonuses or payments. You can look at payslips to get an accurate figure and then calculate your weekly or monthly income amount.
Now all you need to do is subtract expenditure from outgoings and you can then clearly see if you have any spare money or if you are over-committed. If you have money leftover then you can plan what to do with it and if you are overspending then you can take action to balance your finances.
Securing a loan could be one way of consolidating and eradicating debt. Knowing how much you are overspending helps you to work out how much you need to borrow and therefore pay back.
There are several types of loan calculator available online which help you to determine the interest payable on a loan over your chosen repayment period.
By calculating loan payments you can work out the total sum to be repaid and the total interest you will pay, giving you a crystal clear picture of your finances and how they will stand in the future.