Many people choose the New Year as a starting point for a new financial control strategy. We may be in 2013 but the economic climate is still in a pretty bad way and it’s not expected to get better any time soon. Thankfully, there are a few really simple steps you can take to keep an eye on your finances.

Setting up a budget

money jar

It may sound obvious but you need to sort out your spending. This involves recording everything that comes into the house and everything that goes out. It doesn’t matter how you record it; whether it’s a spreadsheet on a computer or just plain old fashioned pencil and paper, you must note down every transaction. When you start to do this, you may be in for quite a surprise when you realize how much of your income is being spent on nonessential things.


Gather details of all of the household’s monthly income, jot it down and sum it up. This is the capital you have to use for all your expenditures. It includes your wages after tax (how much you actually take home with you) and anything else you might get paid for.


Create another column, listing all of your expenditures each month and then total all of these to give your total monthly outgoings. This should include absolutely everything: mortgage/rent, food, utility bills, phone bills, insurance policies, savings and fuel.

Now that you’re analyzing your expenditures, you can go about optimizing your monthly budget; scrutinizing it and looking for ways to save a few dollars here and there in different expense items. You’ll soon realize you can make massive savings.

The aim is to deduct your total monthly expenditure from your total income and still have money left over to channel into other areas of your budget. Of course, some expenditure you’ll be unable to save money on as you have to pay a minimum amount; things like credit cards, loans and mortgage repayments.

These outgoings are known as fixed expenditure so you may very well want to separate them from other variable length expenditures; groceries, phone bills and utility bills, for example.

What if I’m over budget?

If you’re over budget, you need to cut back on some of the variable expenditure. You may even have to consider cutting things out all together.

If utility bills are an issue, try switching to different providers if possible. You could cancel premium television subscriptions, find a cheaper insurance broker and maybe start shopping somewhere a little cheaper for groceries.

Hopefully, by doing this you’ll be able to bring your outgoings down to a more suitable level.

What do I do with my left over money?

Now you’ve sorted your finances, you may find yourself with some money left over. Don’t blow it all just yet though. The point in planning a budget is to be sensible about your finances. With the money you have left over, you should focus on other areas of your budget, such as paying debts off or saving for the future.

Every month you should go back to your budget and revise it. You should have the mentality of trying to tighten it up as much as possible, to save at every opportunity. You should always be on the lookout for ways to save cash with deals and offers. Keep it up and you’ll be a budgeting ace by 2014.

Louise has worked as an accountant since 1998 for Wainwrights Limited; specialists in sole traders, partnerships and limited company accounts, payroll services, VAT and tax.

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