Let’s look at an example, using a composite couple, “Henry” and “Janine.” The first time Janine and Henry tried to make a budget, they realized they had dropped over $450 the previous month on dining out. You plan for how much you will spend in the future. You figure out how much you have been spending. You sit down with your accounts and receipts. We often tend to think of budgeting as a one-and-done kind of chore. The government’s MoneySmart, opens in new window website also has a comprehensive section on budgeting that’s worth a look.Step 1. Our budget planner will do a lot of the sums for you - and average out those tricky occasional costs to a weekly number. These might include pet costs, uni or office fees, childcare, and beauty costs. This is where you’ll budget for everything else that doesn’t fit within the categories you’ve laid out. These include personal loans, credit cards, store cards and other loans, and the interest that comes with them. Replacing these can make a significant dent in your savings if you don’t have a plan in place to prepare for them ahead of time. Replacement costsĮvery now and then, you’ll unfortunately have to replace items like the fridge, washing machine, TV, or lounge suite. Think about all those incidental costs that pop up over the year: magazine and TV streaming subscriptions, weekends away, movies, Christmas and birthday gifts. In this section you can also include lifestyle costs like gym membership and sports club fees. Health and wellbeingĪlthough these costs might be occasional, your budget should take into account things like medical costs such as going to the doctor or dentist or optometrist. They may be yearly or monthly, but make sure they’re factored into your final budget. If you have any sort of insurance – health, life, car, travel, home or perhaps income – you’ll be paying premiums. CommunicationĬonsider the bills for your mobile, internet and (if you still have one) landline charges. Public transport’s often cheaper, and this also should be factored in. Fuel’s just the start-there’s parking, repairs, general maintenance and insurance.Ī good budget also considers future expenses like replacing your car at some point. The costs of running a car can easily add up. If shoes are your thing, you’ll need to account for these too. You might want to divide this category into your work clothes and your fun clothes to sort out what’s necessary and what’s not. Don’t forget those coffees and other incidental snacks – it all adds up. This includes your groceries, but also your takeaway lunches and evening feasts out. To assist you with your decision speak with one of our specialists. If you own your own place, you’ll also be hit up for home maintenance (repairs), home and contents insurance, rates, and utilities (e.g. The biggest expense you’ll face is probably your rent or mortgage. Try our budget planning calculator to get your budget started. Let’s start with the basics: food, clothing, housing, transport, communication and insurance. It’s helpful if you group things into categories. Remember there are some big costs that only come up every year, or less, like car insurance and registration. Go back over the past two or three months and make a note of everything you’ve paid for. But to create a realistic budget, it’s important to find out how much you’re spending, and on what.įirstly, take a good hard look at your bank statements. It can be easy to underestimate how much you spend on a day-to-day basis. If you don’t have a bank account yet and not sure what the best option is, head to our youth banking page for advice and guidance. Good savings habits formed young are a great way to set you up for later in life and setting up a bank account is an important first step to keep you on track. It’s never too soon to start budgeting and saving, no matter what stage of life you’re at. Like to budget but think you’re too young? Use your last tax return and work out your weekly net income (after business expenses, GST and PAYG).ĭo you have any other sources of income - interest from investments, government contributions or child support payments? Work out what they average week to week, then add this in too. It’s trickier if you’re a contractor or self-employed, or if your income varies wildly from month to month. How to work out your incomeįor most of us, this is a matter of checking our payslip or salary credit and seeing what we get (after tax and super). But for now, let’s start with the numbers. In our second budgeting story, we’ll look at how to stick to that budget. While it can be tempting to put it off, creating a realistic budget can help you hit your savings goals faster. A budget shows you how much money you’re earning, how much you’re spending, and how much you’re saving.
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