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5 Tips for Living on a Budget

5 Tips for Living on a Budget
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We all know that living on a budget can be frustrating. It can feel incredibly restrictive – you might not be able to do all the things you want to, as you’re constantly thinking about money. But if you try to focus on your end goal, whether that’s saving up for something exciting, or getting out of debt, budgeting will be worth it in the long run! 

Budgeting also doesn’t have to be an all-encompassing thing. While the rise in utility bills and petrol costs mean that we’ll all have to be a bit more considerate about spending, that doesn’t mean that we need to limit ourselves completely. A budget is whatever you choose to make it, and should reflect your individual circumstances.

1. Get Your Priorities Straight

When it comes to living on a budget, the first thing you need to do is determine your priorities. Are you looking to get out of debt? Are you hoping to buy a new car? Perhaps you’re saving up for a deposit on a house, or to go on holiday. Whatever the reason, you need to think about the overall goal of budgeting.

You should also start considering what things are essential in terms of spending. For instance, you need to prioritise your rent, utility bills, food, and any outstanding credit you have. These are things that have to be paid. Other things you may be able to live without – make a list of some of the things that you could cut back on, or get rid of all together. The trick is to separate your needs from your wants! 

2. Create a Budget

Now comes the tricky bit – listing all your income and expenses, and making sure that you’re balancing the books, hopefully with a bit of money left over. A well planned budget can make all the difference when it comes to saving money. So try to really think about what your expenses are, and allow for some wiggle room.

There are all sorts of ways in which you can create a budget. Some people prefer to have it all written down in front of them, while others prefer an electronic spreadsheet. Or you can use one of the handy budgeting apps that have been developed over the last few years, such as Chip or Acorns. Some banking apps, like Monzo, can also help you put money into a savings pot. 

3. Save Money on Food

While you can buy cheap food generally, it’s not always the healthiest option, so some people don’t think that budgeting on food is a great idea. However, there are ways you can reduce how much you spend on your food shop, while still buying healthy options. A great way of doing this is to shop just before the supermarket closes. They’ll have reduced a lot of their stock by this time, and you are sure to find lots of bargains! Even if you don’t fancy eating the reduced food that day, you can always freeze it. 

There are a few other obvious ways to save money on grocery shopping, such as going to cheaper shops. Lidl and Aldi can have some of the cheapest options, though other supermarkets are making an effort to price match them. Loyalty cards can also help you save money, as can buying in bulk. And don’t forget to eat before you go shopping – buying food on an empty stomach is never a sensible idea!

In terms of eating out and takeaways, these will probably have to be treats when you’re living on a budget. Unfortunately eating in a restaurant or getting a takeaway are expensive options – it’s always much cheaper to cook your own meal.

4. Consider Your Entertainment Budget

After food, many people spend the majority of their disposable income on entertainment. Things like going to the cinema, or even popping to the local pub for a few drinks – all these expenses can really add up. So it can be a good idea to consider ways you can cut back on your entertainment budget. Subscriptions to platforms such as Netflix, Amazon Prime, Disney+ and Spotify may not seem like a lot of money, but they can become a large expense if you subscribe to lots of these platforms. Perhaps see if you can do without a couple, and choose the ones you use most often!

You can also think about fun activities you can do without really spending any money. Perhaps arrange a board game night with your friends, or start a new hobby. Baking and cooking can be great things to do with others, or you could try doing some exercise at home or in the local area. That might even mean you could cancel your gym membership!

5. Shop Around for Offers

Another great way to save money is to really consider whether you’re getting the best price. Whether this is for your utility bills, car insurance, phone bill, or just about anything where there might be a cheaper rate, you should try to shop around. 

And when it comes to fashion and any hobbies you might have, you may wish to think about buying things second hand. Charity shops, as well as websites like Gumtree or Facebook Marketplace, can be a fantastic place to pick up good quality second hand items, and you can save yourself a lot of money.

It’s also worth bearing in mind that if you do end up needing a finance solution, it’s sensible to shop around for interest rates on loans. My Financial Broker can help you find a suitable lender when it comes to short term loans – get in touch with us today to learn more!

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