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Planning your finances and budgeting
Things you might want to consider when managing your finances, budgeting and planning for a better future.
If you have any questions, please call our friendly team on 03300 244612We've outlined key things you need to consider when planning and taking control of your finances.
Budgeting and managing your money
Budgeting for everyday essentials such as food, fuel and a roof over your head is relatively easy to plan. More challenging however, is to build up a ‘buffer’ to cope with the unexpected – perhaps the need to replace your car or to survive a period of redundancy.
Whilst putting aside some money for future plans is not an exciting activity, savings give you flexibility to do things when you want to, without impacting on your daily existence or running into debt.
Budgeting might be seen as dull, but it's also common sense. It's never too early to create a credit and debit spreadsheet, where you should list your income and your outgoings, such as food, clothing, car costs, travel, energy bills, and leisure pursuits. The point
being that you should organise your finances to make sure your spending never exceeds your income.
The old fashioned way to budget is to list all of your income on one side of a piece of paper and outgoings on the other. If you put this into a simple spreadsheet this will work out the figures for you as you go along.
Nowadays there’s plenty of personal finance software available on the internet and budgeting apps you can download. Some, usually those with a cost attached will “sync” the data across different compatible devices so that you can update the information wherever you are or between different users.
You can also use the calculator on the Money Helper website.
If you'd like to help you children or grandchildren to start budgeting their own money, you can use our free money guides 'Budgeting basics' and 'Better budgeting - preparing for independence'.
You can view the full set of Money guides for children here.
Making your budget work for you
Using a budget planner allows you to prioritise your spending.
Rather than just spending first and then reconciling your incomings and outgoings, a budget planner enables you to see whether you can indeed afford a holiday or replace a household appliance.
A good budgeting plan, therefore, means moving money from one side of the balance sheet to the other, ideally reducing outgoings to make saving easier.
And remember not to put off a pension
Whilst saving for your retirement always seems such a long way off, you should, if and when you can, start putting as much as possible aside for your retirement.
Of course, money saved in a pension plan is tied up and for most people, cannot be accessed until the age of 55 (rising to the age of 57 by 2028).
Your future financial security is just as important as your current situation, and the earlier you start saving the more time your pension will have to grow. A good pension income will give you much more choice about how you spend your retirement.
You can find out more about pensions and retirement on the Money Helper website.
If you have any questions about what you've read, please call our friendly team on 03300 244612.
Use our savings calculator
Not sure of the best way to save? Try our savings calculator to work out how long it'll take to reach your savings goal.