5 Top Tips on How to Budget

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With wages not keeping up with inflation and the price of food, clothing and utilities such as gas and electric rising a lot of people are feeling the pinch.  So what do you do if an emergency comes up like your washing machine breaks down or your car is off the road? Here are some handy tips that you can try.

Work Out Your Budget

Whatever your income there is always somewhere you can cut back; one less takeaway per week, make sandwiches to take to work rather than buying expensive pre-packed ones etc. You will need to work out your budget, what you are earning to what you are spending and you will be able to see where you can cut back and how much disposable income you have.

Cut Costs

Cutting costs sounds easy doesn’t it? Well it doesn’t have to be too difficult. Once you have worked out your budget you will be able to see how much you are spending on thing like gas, electricity, phone etc. and then be able to compare prices and switch to a better, more affordable deal; Money Saving Expert, among others that can be found on the internet, offer some great advice.

Saving

Not a lot of people save these days, which can be an issue when an unexpected bill arrives. Open a savings account and put a small proportion of your wages away each week/month. You’ll be surprised at how quickly putting £10 per week away will build up into a nice amount for those unforeseen problems, Christmas or even a holiday.

Credit Union

Another alternative to saving with your bank is a Credit Union. A credit union is a community owned savings and lending scheme where you can regularly save money and if need be take out a small loan at lower interest rates than your bank. They are protected by the Financial Services Compensation Scheme up to the value of £75,000 per person so you don’t have to worry about your savings.

Emergency Borrowing

What do you do when your car breaks down and you need to get it fixed to be able to get to work? If you have been saving you might have enough available to cover the cost. But if you don’t you will have to think about taking out a small loan. These can be quite handy for a short-term fix (usually for up to 1 month) as long as you only borrow what you can afford and pay it back quickly (your next pay day).

Hopefully you can use some of these tips and help your household with expenditure and savings.

Image source: Pixabay
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