What does budgeting look like to you on a daily basis?

[Dunnesbest]

On paper we have a good income, bills are paid and we have a good savings pot. After bills etc we have what appears to be a good amount left over but at the end of every fortnight I seem to need to dip into savings. In reality that good amount has to stretch very far, between daily life like fuel and groceries, plus variable one off expenses like birthdays car repairs clothing etc. Its these variable expenses I struggle with, plus because the amount after bills seems healthy we overspend on meals shopping etc.
So I need to rein it in, that's fine, and obviously need to start putting aside a fixed amount for variable expenses. But on a day to day basis does this mean accounting for every penny? I don't think i know anyone who actually does that. It seems quite joyless and soul destroying.
So how do you manage your finances on a day to day basis?

We contribute £1250 each into a joint account , half is mortgage (7 payments left) around £500 is other utility costs / council tax leave £750 for groceries , cleaner , dog costs and the odd meal out. We pay our own fuel, mobile , car insurance etc from our own accounts. It works so we can see what is left of the joint account and monitor spending accordingly. Recently we have started to assign £100 a week on groceries and anything not spent we pop into a savings tin towards treats

We don’t budget day to day, but we have a realistic amount of spending money after bills are covered. Surely if you are dipping in to savings each month you either need to up your allocation for spending and therefore save less, or really budget what you spend to bring the cost down? How much leeway do you have?

I just pay for stuff as needed, and occasionally check my banking app to make sure there are no surprises.

I have a monthly standing order to a "variable expenses" account so when e.g. birthday or the car service come up, it comes from that pot rather than savings. It's the same thing really, but means that these expenses are accounted for in the monthly budget, even though they're not the same every month.

We pretty much do account fo every penny

and that means we know on average how much to keep aside for your variables

edit ot add it doesn’t take long and isn’t soul destroying

I do account for every penny, it’s called zero-based budgeting. So every time we get income, it’s all assigned to pots: bills, food, family fun, personal spends, car maintenance, holidays, birthdays, Christmas, boiler service, haircuts, new clothes, house maintenance, etc etc. Over time I’ve adjusted our budget to reflect changing circumstances and priorities. I already have Christmas mostly funded, by November the money will all be in the pot and ready to be spent. My boiler service is due in Jan, the money will be waiting for it when I book.

I don’t really find it joyless; I find being perpetually skint and stressed joyless personally! I use an app that works it out all for me so it’s very little effort. I like knowing what I can spend and not having to worry about ‘unexpected’ expenses which are not really unexpected at all. Stuff breaks, cars need new tyres, Christmas happens every year. None of this should surprise us!

I suppose i need to rein in the mindless spending on clothes, make up etc for me and the dc. Then I wouldn't need to save less. I suppose I think that zero based budgeting is joyless and takes the spontaneity out of life. For example I have a big family birthday and family wedding coming up, if I budget for those there is nothing left for fun, shopping, unplanned lunches etc. Its just easier to take it out of savings isn't it? I just need a complete mindset shift I think .

Think you are right there!

musy admit I don’t find I need a lot of cash for shopping and unplanned lunches and the like - it’s more fun to look forward to a lunch or shopping trip anyway. It does help to have things to look forward to - skip the ice cream today means a little more in the holiday spending fund

Pp asked how much leeway I have, well not a huge amount as paying debt. Savings could pay that debt but Ill have a ds starting uni next year. Plus extra leeway = extra mindless spending. I could do some extra hours at work but that wouldn't be needed if I reined in the mindless spending. Its not a huge amount ( I don't think), maybe 3 to 400 pounds per month. And obviously some of that is needed such as clothing skincare etc.

But clothes etc I put away an amount every month - then when I spend it gets allocated against the clothes pot. Same with birthdays / Xmas everything.

even glasses - I put away monthly for them so when I need a new pair it doesn’t impact that months money.

This is why the variable expenses account works well. I know roughly what I'll spend on one off expenses, gifts and travel in a year. Divide it by 12, add 10% contingency and set that aside eqxh month. Then it's covered whenever it comes up and the larger ones are spread across the year.

Re the incidental spending, I don't "let" myself buy anything like clothes, make up until halfway through the month. When we get there I often can't remember what it was I'd planned to buy, so I can't have wanted it that much! The other way to do it is to wait 24/48 hours. You can have it if you still want it then, but often for impulse purchases you won't.

I probably spend that over 6 months not one

and then blow out - just booked a trip in September

clothing and skincare can be be birthday and Christmas gifts also

I have friends who rather that account for every penny on a day to day basis, have different “pots” for things which make it visually much easier and stops the mindless spending because if say you have £1500 in your account, your £40 in Boots feels like nothing. But actually if you separate your “fun money” for the month out into a separate pot of for example £400, £100 per week, suddenly that £40 is nearly half your weekly budget in one shop. Breaking it into separate pots makes you more mindful because rather than it all being one big pot where £40 seems like nothing, you can see how much of your fun money it eats up.

Same with food shopping, if there’s a £500 pot for the month you’re a lot more mindful of a weekly budget than if you have it all coming from £1500.

Also totally agree with others, think long term rather than short term. Birthdays, holidays, car MOT/service, family wedding etc doesn’t sneak up on you, plan for them, work out your spending and divide by 12, save monthly into a separate pot so that rather than being rich one month and skint the next you just have the money there

I love budgeting and I hate running out of money!

On payday I send a set amount to my bills account and work out what I need in my food/fuel/fun account (set amount for food and fuel each week and whatever is left is fun money so if I over spend on groceries I don’t get the not previously arranged lunch out or don’t get the make up but I do try to work out what’s coming up that month which is why it varies). I keep an eye on what comes out of these and a daily tally of my spends.

Then I send amount to savings. I have savings accounts for holidays, car stuff, Christmas/birthdays and an emergency fund.

I have no debt.

I am self employed but pay myself the same amount each month from my business account.

From that I have a monthly transfer the following day to a separate 'bills' account that covers all my DDs for things like gas, electricity, broadband, phone, water, council tax, monthly pension and ISA contributions and also an allowance for car insurance, home insurance, car tax and repairs/MOT.

I then have a number of smaller savings accounts that a set amount transfers to each month to cover Christmas, Birthdays, Holidays, Car Replacement and Home Improvements.

What is left in my account by the third of the month is my 'spends' for the month but I do have to cover food and fuel from that.

It might sound really regimented but I find that although I think I earn a reasonably good salary I still overspend really easily if I don't transfer out all those amounts at the beginning of the month.

I do log every £1 spent in a spreadsheet into categories, yes. DH and I do it together once a month, go through all current accounts and credit card statements.

Then periodically we go through our balances and check the savings rates, growth / fees / ISA allowances etc and how much we can afford to spend.

Annually I look at the total amount we have spent on each category compared to what I predicted.

I like to feel in control of my finances. It doesn't mean I have to scrimp and save and avoid spending altogether at all. It actually gives me permission to spend guilt free, knowing what I can afford.

@Patchworkted I'm the same, I try to wait until I'm at least halfway through the month before buying any clothes or fun stuff as I know better then whether there will be anything leftover for treats.

Ironically I broke my own rule today and ordered a new dress for a party on Saturday....whoops!

I keep it simple - bills come out as close to payday as I can, and I have the ‘pay yourself first’ philosophy - every payday I move at least 10% of my pay to my easy access savings account. I can’t be bothered with adding money into different pots. What’s left is for food and fun stuff like eating out. I do a monthly online food shop which reduces expensive and time-consuming top-up trips. Every few months I look at my bills and assess if I could get a better deal from another company, and every couple of days I check on my banking app what I’ve been spending and what my balance is.

Fwiw I'm taken aback by "clothing skincare" as examples of things that have to be spent. For me, both of those are paradigmatic examples of things I'd only think about spending money on if more important things, including saving, were already accounted for. I guess I'm assuming everyone can be minimally decent, and assuming there's soap!

This. I never budget and would find accounting for every penny soul destroying, as you say, OP. I know that this is a privileged position to be in. I don’t have expensive tastes so usually when I want something I can afford to pay for it and don’t need to budget / save up.

I am old and quite seriously well off.

I barely spend any money, except on stuff that is either essential or really important to me. I have done this all my life and never, not ever, felt deprived.

I never buy takeout coffee, impulse buy or otherwise spend money without making a conscious decision.

I always prioritised boring stuff like pensions and ISAs. While not neglecting the ‘this is important to me’ stuff.

Another fan of zero based budgeting.
Allocating enough money for the annual expenses like car insurance, tax, service and MOT x2 plus other insurances, plus holidays and Christmas was a real eye opener when I first did it. It is a lot of money, so that gets moved over on payday.
Then normal monthly bills like gas and electric and council tax and phones and personal spends and dentist and gym get paid on first of the month
Then move enough for food and petrol into that account
Then see what is left and move a good chunk to savings, leaving very little for family fun and clothes for kids
Personal spends cover our own clothes and fancy skincare and other hobbies
Sounds like you need to do a MSE statement of affairs and see where your money is going and how little is left over

I have a weekly food budget, and £130/month for gas/power. We both have a hair cut every 6 weeks. We spend a small amount on a class and swimming.

Beyond that I don't have a budget, I just don't spend anything that isn't essential. We had a week in Greece this year but it was carefully budgeted and saved for. I don't buy coffees out, no subscriptions, no alcohol. No impulse buys. No nails or brows.

So far I've been able to cover essentials like school uniform, and car servicing.

I really like the pie chart that you get with the Monzo app (I’m sure other banks do similar things) that shows you how much money you have and how much of the month is still left so you can see at a glance if you’re on track to run out of money or have some leftover. It’s good for just knowing at the back of my mind that I can’t spend or anything frivolous or that I can.