to ask how on earth you budget?

[heraldgerald]

Sorry if posting in the wrong place, really need advice.Endlessly struggling with money no matter what we earn- both d h and I pretty rubbish with money and we have never, ever saved. This is not great, I know. Trying to sort this out, we need to save for a house deposit. How on earth do you do it?

Find out what's going in and out. Allocate an amount for groceries and savings. Split whatever is left equally (if anything!) for spending. We have a joint account but take our own spending money in cash so we don't overspend.

I keep a running total of all household grocery spending in the back of a notepad in the kitchen! I do it weekly and it enables me to see how much of our weekly budget we've spent.

Do a spending diary for one week, ideally a month if you get paid monthly. See where you are haemorrhaging money. Then you can plan from there.

I do it on paper - it's less easy to ignore then!

I take all my incomings for the month on the left, then I put ALL my outgoings (bills - standing orders, direct debits, debt payments, household bills, fuel for car - but NOT food) on the right.

Then, I deduct that total from the total in and divide it by however many weeks till the next pay day. Then, from that total, I take £40 for food and save the rest.

Agree with others - to start off with, you need to find out where your money is going.
The best way to do this is to write down everything you spend over a week (or if you can bare it, a month). A week should probably be enough to find out where your cash is spent... coffees? lunches bought instead of made at home? magazines ? .....
Then, take an evening or time at the weekend, and go through all the bills you pay regularly - gas and elec, TV package, phone (land line and mobiles), insurances, mortgage, and run your details through price comparison sites to check you are getting the best deal.
Have a look if you are paying for things you don't really get the value from... from a bank account with a monthly fee, to a gym membership you don't really use.
Then come back and let us know where it's going and we'll suggest how you can save.

Another thing I've done ever since my very first pay-cheque is to have a standing order going to a savings account on the day my salary is paid in. Yes, in the lean years, we've regularly had to take it out again before the end of the month (or part of it) but it makes you think twice if you have to withdraw money from savings, whereas you would just spend it if it were in your current account.

The only way I've learned to save is removing an amount as a standing order ( or whatever they are called) on payday, straight into an account I can't access without notice
Same with pension...I never even see it

Weirdly if you are shit with money you then just make do with what's in the current account
This was my experience

Have a look at www.YNAB.com - you can do a free trial of the software and most people save a least the cost of the software in the first month.

I actually use YNAB, so I would recommend that, too.

You need to figure out where you are losing money. Assuming your income is enough to meet your bills, writing everything down that you spend for a month will help you see where you're losing. For us, it was groceries. It's very easy to overspend on groceries, IMO.

Once you've figured out where the money is going, you need to set a budget for each category and stick to it. We do that by using cash. I budget $200 per week on groceries, and I take that out of the bank in cash. Once it's gone, it's gone. There's a measure of discipline in it, but it works well.

Another thing that really helps is to save money each month for irregular annual expenses like holidays, Christmas, insurances (these usually cost more if you pay monthly) and car MOT. Add an amount on top for emergencies like broken washing machines etc. The amount needed will be several hundred pounds, especially if you have foreign holidays.

You also need to have an idea on what you have coming in, what goes out and what is an affordable amount to spend on things like coffees, lunches and meals and drinks out etc. if you buy your work lunch 'out' every day, it is quite easy to spend hundreds of pounds a month on this.

Also second the suggestion to save at the beginning of the month.

Lots of very detailed budgeting advice on www.moneysavingexpert.com

If you have online banking, the best way to start is to look at last month (at least, you could do more) and write down what you spent and on what. Doesn't have to be to the penny, but you end up with a list of outgoings and realistically what you spent, then you can start looking at what you need and can't change, what you need and can change and what you don't need.

I have a weekly budget and stick to it

after bills and mortgage anything left over is saved - and used to pay for treats or emergency things

Use cash only as then you have idea of how much you spend. Make sand witches, shop at Lldl and only pay bills. You be surprised how little in spend!

I third the YNAB suggestion. It's really turned our finances around in the last year.

Learn to be frugal .

If neither of you have ever saved I actually think it would be very hard to 'learn to save' - some people spend all the money they earn and it must be a very hard mindset to get into the habit of saving - just as it is hard to get out of the habit of saving .

I have always saved, we paid off the mortgage in our 40s, but are comfortable living quite a frugal lifestyle, other people I know are horrified at the choices we make - but everyone's different. Now I could afford to buy a lot more 'things' but am so in the habit of saving that I am very reluctant to spend on things like a holiday or clothes - what's wrong with charity shop clothes? .

Goodness thanks every one I'm really grateful . Practical budgeting needs to be addressed as well as trying to work out why we have such an unhelpful attitude towards money

I direct debit savings as soon as pay check comes. That way I don't feel I've loads to spend

Also have cut back on groceries - batch cook, use less meat some evenings, shop at lidl.

Clothes- I still buy but I don't get everything I want

Charity shops - I got a lot of nearly new baby toys and gro bags

We don't go out now (baby) so that's helped spending!!!

My top tip is to sit down on payday and work out exactly what you need to pay out that month - including birthday presents, dinner money, petrol - literally everything that you can know in advance that you will have to pay for. Then subtract from your income. The figure left is your disposable amount that you can spend as you wish and THIS is the important figure, not your income.

If you receive child benefit, try and have it paid into a different account and only access it when you absolutely need to. If you can go 2-3 months without touching it (hard I know when every penny counts) you will build a little buffer without thinking about it.

You Need a Budget, or YNAB. Best £20ish I've ever spent! It takes a good few hours to set it up but it's well worth it. It's turned around our spending most of the time :)

Make sure you are considering all of your expenditure, such as Heating, Lighting and even washing/cooking.

When I read this board and visit other people, I realise I'm really tight on these, but I do save and then have spending money for fun stuff.

I've saved up for my garden to be done, I've even stopped buying paper towels etc, leaving things to air dry. Reusable cloths, storage containers, to cut down on foil etc.

No air fresheners, windows are opened etc. Cleaning products cut, small changers add up, also.

Great advice thanks every one.

Great advice thanks every one.

Great advice thanks every one.

I like separate accounts, one for D/Ds and one for spends so you know you've paid the bills and what's left in the other account you can spend/save. I keep a buffer of 1k in our current account, I can only spend above that buffer. Our o/d fees are huge so will do anything to avoid it.

Keep a spreadsheet of income and outgoings. For a couple of months write down EVERYTHING you spend (and your DH). You can then see exactly where your money is going and what you can cut down/cut out.

Then when you can plan your budget, leave a "contingency" each month for unexpected expenses, and save whatever you can.

Yet another YNAB fan. It has revolutionised our finances. We used to go off the current account budget and adjust for known but would forget some DDs or forget that this was the month the house insurance was due etc. YNAB helped us plan out all the monthly DDs and irregular (quarterly/annual things) and then helped us categorise all other spend and adjust the budgets. Totally worth the money.

Very useful tips on their website and blog too.