As most of you know I'm slightly OCD (ok maybe a bit more than slightly).
But hey, everyone has their own quirks about them. I'm just happy mine include budgeting!!
And with our ever expanding family, soon to be two adults and 3 children, a budget is a bloody great idea to help us save money.
The end of financial year is coming. And as my baby is due July 3rd I thought I would get organised a few weeks early this year.
I thought I would start by showing you my 'budget spreadsheet' and then explaining how it all works.
It's such a great way to keep track of everything, and seeing where your money goes.
So this is my budget book-yes I know that the computer makes a better spreadsheet. I use my computer for everything else but I just can't seem to swap my budget over to the technology world!
The headings I use are:
GROCERIES- this is pretty self explanatory
JUNK GROCERIES- these are all the unneeded packets of chips, chocolate biscuits, soft drink. Basically just food you don't NEED.
ESSENTIALS-is for all the miscellaneous things that are a NEED. Some examples of the items I put under this heading are; dog food (which I don't buy with my groceries, otherwise you could put it under that heading. Stationary. Birthday and Christmas presents for family/friends. Pull-ups. Bulk laundry powder, school supplies, school fees, Weed killer.) basically things that you need to pay for but don't fit into any other category.
NON ESSENTIALS- this column is for your WANTS. We include books, DVDs, trips to the zoo, bunch of flowers, toys unrelated to gift giving, beer. Also include things like pay tv, makeup accessories, car parts (non essential) etc in this column.
VET- it's good to keep track of how much our pooch is costing us (steadily increasing with his age!!)
PETROL-you will be amazed how much you spend each year, and how much you can save when you think about it!
EATING OUT-include takeaway, morning cup of coffee with friends, afternoon tea at the local cafe, eating out at restaurants etc. basically any time you eat away from home (unless of course you pack it yourself!)
MEDICAL-some of you may not need this column. For us our medical bills are huge! I keep track of doctors appointments, chemist trips, prescription medication costs, visits to the physio etc in this column.
CLOTHES AND ACCESSORIES- clothes, shoes, socks, jocks, bras, hats, beanies, boots, thongs etc.
TOOLS-something we need to help hubby with his tool allowance budget. In his job, as a heavy duty mechanic, he goes through LOTS of tools. Sometimes a couple thousand dollars a year. So we keep track of this.
BILLS- this is probably my favourite tip for anyone. At the end of each financial year I tally up ALL our bills. Life insurance, power, water, gas, drivers license, health insurance, car insurance, any loan or credit card repayments, phone and internet, school fees, mortgage/rent and average costs of car services. I work out the weekly, fortnightly, monthly and yearly total costs of these. As we get paid fortnightly, each fortnight I put aside that amount of money needed. That way as soon as a bill comes in I know the money is already sitting in our separate account ready for me. Also all my direct debits come out of this account so I know what's in our "everyday" account is for us. This is one of the biggest tips I could give anyone wanting to start a family budget. It spreads out the cost of everything across the year and makes things that little bit easier. I know that when I get a bill come in that there is already money waiting for us, I don't have to scrounge around and cut back on the groceries to pay the bill.
KIDS ACCOUNT- each fortnight we put aside a small amount for each of our children to give to them when they are 18 (or 21 I haven't decided, depending on their maturity levels!)
I then tally up the weekly sub totals for each category and keep a running 'year to date' total for each category.
Every 3 months I match it all up with our wages. Writing our net income, total spendings, total bills etc and hope it all comes out right! And so far it has all matched up perfectly.
This will be my third financial year using this budget method. The first year was a real shock to us both. We spent over $3000 on petrol, $12,000 on groceries!! Who knew?!?
It really opened our eyes. And because it's written down in plain sight in front of you, it's easy to tell which areas you need to make cut backs in. For example if your spending $10,000 a year on non essential items you could look at having a finance goal of decreasing that by $2000 for the next financial year. If your medical costs (like ours) are nearing $4000 a year then you can look at what areas you can make cut backs in so that you can afford this more easily, or you could look that your private health insurance to see which areas you want to add, or take away from your policy.
At the beginning of each new budget book I attach a copy of the last financial years totals for each category. It helps keep me motivated and on track. If I can see us creeping up too close to last years huge junk food bill I know it's time to cut back and rethink how I can change that (by making more homemade foods, packing snacks when going out etc).
I also highlight the 2 or 3 areas where I really want to make cutbacks. Eg. last financial year I highlighted our credit card-because I really wanted to get rid of that. For this coming financial year I'll high light the loan for our new car, so we can focus on paying that off as fast as possible.
It seems like such a hard task to write down where EVERY SINGLE DOLLAR goes. But really it's easy-if I can get my hubby to start keeping his receipts then anyone can do it!!
Even now while we are living 1600kms apart he still sends me a quick text saying "$47 at Coles, $18 on beer"
Once your get into the habit, it becomes just that. A habit, like any other habit you pick up. It's easy, every night you spend literally like 2 minutes quickly jotting down your receipts into each category. Every three months I do a year to date total and compare with our wages and once a year I set up our new budget book.
It doesn't take long, and once you see where all your money goes you will be glad. You can save thousands just by watching your money. Fuelling up your car on Wednesday can save you hundreds per year- it's the cheapest day of the week.
That's our family budget. It's been the most amazing 2 years doing this. Hubby is completely sold on the idea and is always asking for updates. Going into our third year we have added a couple of extra category's (the tools, junk groceries and vet were not on the original list).
When making your own family budget you can have any headings you want.
Give it a try for a year and see where it takes you.
You might must surprise yourself. Or you might die of shock as hubby and I did our first year!!
