I love that saying – do you always have some month left over at the end of the money? I first saw it on a fridge magnet at a service station we stopped at once and from then on it’s been my favourite saying.
It doesn’t matter how much money your monthly budget says you should have left over at the end of every month if the actual amount left in your bank account doesn’t come anywhere close. When we first started working out what our monthly budget was, we were pleasantly surprised to see that we had a healthy amount of money left over each month after our bill payments had been come out and we’d paid for all of our extra things likes food, petrol etc.
The only problem was that in reality, by about three weeks into the month we had nothing left in our bank account.
We should have done but we didn’t and we had no idea why as we’d written down all of our monthly outgoings and our budget clearly showed that we should have had money left over!
The first thing we did was to go through our budget with a fine tooth comb to make sure we had left nothing out. If it came out of our bank account on a regular basis, we added it in.
The next thing we did was start a spending diary – nothing complex, just a notebook where we listed everything we bought over the course of one month, including food and petrol. At the end of the month, we looked at it and realised that although there were a few things that needed to be added to the actual budget, the majority of the other spending was unnecessary and could easily be reduced.
For example, let’s say our food budget was £250 (I can’t remember what it was at the time), that was the figure we had used on our budget to take into account all spending on food. This should have included all meals at home and any other spending on food and drink that we needed.
Our spending diary showed us that the money we’d set aside for food shopping was enough for each week’s weekly shop. But, on top of that we were both buying lunches at work every couple of days which added up to about an extra £30 ish a month that we weren’t accounting for. There was also one or two ‘top up shops’ through the week where we we were buying extra bits and bobs (largely due to the fact we weren’t meal planning at that time). This added up to around another £80 a month which is a huge chunk! Even the little things like buying a hot chocolate from the branch of Costa that’s situated within our local supermarket add up to around £15 a month. Add the odd McDonalds drive through or takeaway quickly add up aswell, one a fortnight was costing us another £20! Add to that a husband who used to buy a can of energy drink and a bar of chocolate on his way to work most mornings and there’s another £30+ just on that!
So our food budget was £250 but on top of that we were spending an extra £175 (minimum) on extras that we could either a)do without, b)plan better so not need or c)buy for less money.
The food part of our budget was the easiest bit to reduce to be fair – meal planning got rid of most of the unnecessary spending as we didn’t need to do the top up shops and could plan for lunches as well. It also meant we were less tempted on the takeaway front although we do still enjoy the odd one. As for the energy drink and the chocolate – we (or rather he) couldn’t do without that completely so now we stock up on when things are on offer and buy multipacks where possible.
There were plenty of other areas where we were spending without really realising it – birthday presents, treats, trips to the cinema, housey things, the odd DVD or CD, eBay purchases. All things that you can either do without or plan for within your budget.
By keeping a spending diary we managed to reduce our monthly outgoings by a huge amount and we’ve continued to keep our spending down. although it is starting to creep up again so I think I’ll try it again for the next month. I’ll let you know how I get on next month….
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