Sign in Register

Hide tasks (5)

Hide tasks

How-to Guides » OLD GUIDE Manage on a small budget

It's not so much about how much money you have but what your relationship is with your money. It's all about quality and not quantity.

Tasks

OLD GUIDE Manage on a small budget

Get organised

How-to Guide Tips 21 tips on this task | Tweet

1) Gather together all your paperwork

If you've been sensible, all of your paperwork will be neatly filed away in alphabetical/chronological order. If, on the other hand, you're like me, your paperwork is likely to be lying in a disorganised pile somewhere.

Unfortunately, the first step of budgeting is to get all of this together - that includes all of your bank statements, credit card statements, pay cheques, utility bills etc. It's hardly the most exciting of tasks, but you'll feel a great sense of relief once it's done!

2) Set up a spending diary

It can be very easy to lose track of what we're spending where. So to help you understand your spending habits, it's worth setting up a spending diary. This means you need to write down exactly what you spend where!

Every time you take out your wallet to make a purchase, make a record of it. Don't leave anything out, no matter how small - you'll be surprised how the little things add up! It's worth doing this for about a month to help you get a detailed picture.

3) Make a claim

If you’re on a shoestring budget, don’t be too proud to claim what you’re entitled to.

This website should help you track down the relevant benefits and tax credits.

4) Draw up a budget

If you discover your outgoings are greater than your earnings you going to need to sit down and draw up a budget. Find out more in the next step of this goal....

Enjoyed this? Show it some love

Tweet this

Retweet

Comment on this

Facebook

Twitter

General

Tips on this task (21)

32

ben said

Can't recommend highly enough the idea of keeping a spending diary. I used an iPhone app (iExpenseIt) for a few weeks. Just getting an idea of what you spend the change in your pocket on is an insight you can't get from bank statements. It also gives you a target to beat. Within a few weeks of starting mine I found myself actually motivated to bring sandwiches in from home.

Report on 16 October 2009 | Love 0 love
7

Pedros143 said

Ben.....surely the best saving would be to get rid of the IPhone itself and use an ordinary "pay as you go" one. You would save a lot more than sandwich money.

Report on 16 October 2009 | Love 0 love
32

ben said

Yes that's very true - but I look at it as getting control over money I don't spend to enable me to have other things I want. Admittedly this goal is about managing on a small budget and its fair to say an iPhone wouldn't fit into anyone's definition of a small budget.

Report on 16 October 2009 | Love 0 love
3

poppyt said

I have been using the saying "less is more" in everyday life. e.g. only one squirt of shampoo/washing up liquid, using a bit less washing powder and fabric conditioner, kitchen cleaner etc. Even one squirt less of all of these things mounts up. I'm developing a bit of a mindset about this and am applying it to spending too, so saving a few pence/pounds here and there when shopping, I am beginning to see the difference..

Report on 27 October 2009 | Love 0 love
414

Mike10613 said

I went out the other day with a friend. first was petrol and air and went to the cheapest petrol station that was near where I wanted to do some more shopping. I used some vouchers left from Christmas 2007 to half my shopping bill in Curry's although the products may have been cheaper elsewhere; the quality was good. Then my friend wanted to eat at Burger King; we ended up at the chippie and ate at my house! I put everything down in my account book except the chips. I made that meal cheaper by buying chips but cooking chicken in the microwave. It was quick and easy. I had a record of my spending on petrol and in Curry's as I used my debit card. So effectively two records, on my bank statement and in my account book.

Report on 08 November 2009 | Love 0 love
2

keengreen60 said

It takes time to sort things out but, when I am organised, it certainly saves time when I'm trying to find things; also much less frustrating.
As for keeping records and receipts to find out how much has been spent, this has been a nightmare recently because I moved from place A to B where certain big money items needed to be bought (or services bought in). B is much more rural but if I am organised with food and other household items, I can walk to local shops rather than using the car and, if necessary, do a big shop once a month. If I want to go somewhere else I always consider using the bus with my bus pass rather than driving and having to pay for parking. As for books etc, using the local library provides a good source of material and anything can now be ordered (free) as necessary. For some items I use the Internet then things are delivered to my door.
I have also joined a local LETS (Local Exchange and Trading System) and use Freecycle and similar sites to find things I need, or to give to others. I have found LETS a great way to keep green and to make friends.

Report on 04 January 2010 | Love 0 love
0

depa996 said

I try don't keep any money in cash in the pocket or , because I feel temptation to spend that, so I spend less money, and as well I try to bring some food from home to save some money.

Report on 14 January 2010 | Love 0 love
0

chatay04 said

I agree with depa996, the best way some times, is to do as you say and not keep cash in pocket and just change like coins, because I always get the same temptation, to spend money, I've not actually got, in context.

Report on 16 January 2010 | Love 0 love
0

mgriffiths91 said

i agree with both depa996 and chataya04 abot not having cash in your pocket.
i only have cash on me when i go out for a few drinks with friends other than that i use my debit card for everything that way i only spen what i need and don't have the odd £5 to £8 pounds burning a hole in my pocket as i drive past the fast food outlets ect
i only found this out by accident as i was too lazy to go to the cashpoint for a couple of weeks but when i checked my balance i saw i had more money left in my account than i normally have (normally it's virtually zero) so that has given me the wake up call i needed and do this all the time now and building up some money now all be it not loads of money but enough to make a difference

Report on 22 February 2010 | Love 0 love
1

The Tut said

Hi I survive with 3 kids on a budget and my best advice is not to pretend you can when you definately shouldn't. - its not easy to admit that you just can't afford things, and it makes you feel a failure when your trying your best. But teaching yourself and you kids to value money and things is a really good lesson for you and them.

Report on 02 March 2010 | Love 0 love
1

KatieArmstrong said

Hi, Myself and my husband lost our business along with our home last year around this time. I was made bankrupt and felt I was worthless and had failed miserably. I walked away with our two children who were 2 & 3 and they were asking 'why are you crying so much mummy?'.. It has been a hard year trying to claim benefits which I have never done before, but I have survived!! I have tried to explain to my now 4 year old we don't have alot of money nowadays and how we have enjoyed the free things in life. the park, a walk along the beach etc etc. We are fitter, healthier, certainly much happier because the stress and worry has gone. PLEASE don't feel a failure if you are a 'bankrupt', ok my credit rating is awful, but I am still here, I am still standing, and I am proof that there is a life after bankruptcy. Please take my advice and deal with your problems before 'they' take everything off you. Don't feel as though you still have to spend a certain amount on Birthdays, Mothers Day etc etc, Think long term and cut the credit cards up!

Report on 02 March 2010 | Love 0 love
0

liddlelur said

Hi! I belong to an online group called Freegle (Free Giving Locally Easily) which currently has over 214 groups in the UK and over a million members and counting. Freegle has only one aim and goal to stop good stuff going to landfill. Everything offered is completely free of charge you can ask for or respond to an offer for just about anything so long as it's legal, it's kind of like ebay without the money. If your washing machine breaks down you can offer it to freegle members who may be able to fix and use it themselves or sell it or break it up and sell the parts. It's not going to landfill and that's all they care about. Then you can either respond to an offer of another one or post a wanted ad. Even if it only lasts 9 months before it breaks down you can put that one up and get another one, you never really need to buy white goods again. You can ask for or offer anything from clothes, toys, white goods, furniture, rubble from a building project, scrap wood, old windows and anything else you can think of! Just go to www.ilovefreegle.org/ and use the onboard search engine to find a group near you. If there isn't a group near you, you can contact Freegle and ask to start a group, once accepted you'll receive all the help and support you need from a brilliant bunch of people to help get you up and running with free tech support and help from volunteers moderators. Freegle also allows groups, clubs, scouts,charities,nurseries and schools to name but a few to post for resources free of charge. You are allowed to ask for items to sell on for whatever reason (Fundraising for instance) so long as you let the other members know that's what you intend to do with the items and leave it to them to decide whether they'd like to give you their stuff. Something I found was that once I knew I could get anything I wanted I kind of lost interest in getting more stuff! - Liz

Report on 12 March 2010 | Love 0 love
2

abe-lincoln said

I agree with the Tut, and it is the best thing to do. Teach yourself, and your kids about money. Some kids now a days think that money grows on trees. I have one of those old nokia fones, which i call a brick, and they make fun of me sometimes. I bought a new fone for my 13yr old daughtrer and i said to her. Are you still laughing at my brick fone? if i didn't have this brick i wouldn't have money save to get you that new pay as u go fone, and yes don't you think i can't buy a new black berry or some other top of the line fone, ofcourse i can, but am not going to add another un called for bill, so to speak to my budget, when i have a fone that works.

Report on 08 June 2010 | Love 0 love
0

witchill said

When using the oven, switch off 5 minutes before cooking time is up, the oven will stil be hot enough to finish cooking and you'll save on electric bills.

Report on 12 August 2010 | Love 0 love
1

corrinelisle said

I have a running spreadsheet for my monthly expenses (rent, food, insurance) and I also put into there any big social events that I definitely want to go to, with a reasonable budget against them. Then whatever I have left over, I divide up for each weekend to last me until the next weekend and take it out in cash, leaving my card at home. I am terrible at remembering what I've put on my card, so having my weekly cash allowance in my purse means I know how much I have available and makes me less likely to spend £4 on a magazine knowing that is a good percentage of my weekly free money! It also means if I run out of money one week, I only have a maximum of 7 more days till my next budget rather than weeks waiting to be paid again!

Report on 20 August 2010 | Love 0 love
0

Rosali said

Contrary to some of the tips above, I actually find it more helpful to have a certain amount of cash on me each week that I can spend for pleasure - including the odd coffee, newspaper etc. When it's gone, it's gone, and I can't spend any more until next "Pocket Money Day". When I whack it all on my debit card it doesn't feel like I'm really spending, especially when I'm drunk. Cold hard cash is the only thing my brain can comprehend.
On the other hand, I wonder if anyone could advise me - as a young professional working with a budget for the first time, and trying to save as much as I can, how do I know what's a reasonable amount to spend each week on food and entertainment etc.? My friends can be quite a bad influence!

Report on 02 September 2010 | Love 0 love
0

Rosali said

Sorry Corrinelisle! I hadn't read your post before I added mine, but I definitely second your advice!

Report on 02 September 2010 | Love 0 love
6

Axel said

Having all your household services on one bill helps with knowing exactly what you spend each month and is easy to budget.
Look at other ways to cut your monthly spend at The Utility Warehouse
www.telecomplus.org.uk/yousavemore
Gavin.

Report on 16 September 2010 | Love 0 love
0

Sou-saver said

I do the majority of my spending on a cashback credit card - which I pay off religiously every month. I find it easier to keep track of money in my current account by having fixed payments out at certain times of the month - mortgage, council tax, credit card bill. I always tick off items on my bank and credit card statements so I know they are legitimate spends. I try to only go to the cashpoint once a week. Whilst we don't have a huge choice of grocery outlets where I live, I mentally keep track of prices and choose what I buy where I buy it - noodles, for example, are 43p more in the other shop which is just over the road!
However, like some others who have posted, I save on some things to pay for others ... so my recent cashback vouchers paid for a new £80 handbag!!!

Report on 28 September 2010 | Love 0 love
5

iansilverb said

I think this is my wayofsaving money, I put my copper in a jar as I accumilate it, and after every couple of months I have about £2 and I put it in my savings account.

Report on 08 October 2010 | Love 0 love
0

hana said

I too, find that I manage far better using cash instead of my debit card. I also 'shop around' and keep a mental note of prices, these can vary greatly between supermarkets. I read the newspaper online, get my books at the library, walk as much as I can.
This is not as bleak as it may sound, you can meet nice people out there (cant do that in a car), yes, it is wearing at times, but I am seeing the benefit. Thank you all for the tips

Report on 25 October 2010 | Love 0 love

Post a tip

Sign in or register to post a tip.

Most popular tipsters

W3C Thank you for using Lock, Stock and Two Smoking Barrels