Every New Year we set ourselves goals to complete over the next 12 months. Many of our New Year resolutions are targeted at making ourselves to the best we can be. With money being an issue for most people it’s always a good idea to think about cutting costs wherever you can, trying to curb your spending along the way. Setting up a personal budget in 2016 is highly recommended if you want to do just this – here is how you can do just that.
First of all you should set aside some time to create your personal budget. Give yourself an hour or so to collect the important paperwork you’ll need like payslips, bills, bank statements and any other outgoings. Once you have all of these together you can begin working on your spreadsheets.
Sit down and calculate your weekly, monthly and yearly income and expenditures, based on what you would normally make and spend over the course of a given month. If you have a job that is salary based with commission or if you do additional freelance work your income may vary month to month. As a result, we’d advise you to set up four different spreadsheets – daily, weekly, monthly and a yearly budget.
Once you’ve got your four spreadsheets you can start inputting data. The first bit of data you will need to include is your income. After that you can start deducting all of your bills and all other essential outgoings so you can find out your disposable income. After those you will need to factor in other things you spend your money on and how much you spend to work out just how much you could save with your current spending habits.
If set up properly, your spreadsheets will automatically calculate how much you have left after all your outgoings. The best part of using spreadsheets is that you can alter your data at any given moment and the rest of your spreadsheet will change to accommodate the variance. So if you’ve had an emergency that has caught you off guard you can factor that information in. If you’re short one month payday lending could be a potential short term solution.
The most difficult step of dealing with your budget is knowing how much you are overspending on unnecessary expenses. One way to curb your spending is by deciding on how much money you need to live off in a single day and then use cash instead of cards. It has been scientifically proven that paying with cash is more painful than swiping your card. Pay by cash and you will be less likely to give into treats.