With the cost of living rising, it’s no surprise that many people are thinking of new ways to tighten their spending and get better control over their monthly budget. The price of essentials is going up, but unfortunately, wages aren’t really moving at the same upwards rate.
Thankfully there are several things that you can do to get in control of your monthly budget and make sure that you are not overspending, even if you do need to pay more for some bills. From cutting unnecessary costs to shopping around, having a set budget for everything, to using apps to earn money back on your purchases, there are lots of things that you can do to help make managing your finances easier.
1. Be Clear on Your Income and Outgoings
The first thing to do when it comes to managing your monthly budget is to get clear on how much you are earning and how much you are paying out. You can do this by going through your bank statements to figure out how much you are getting in and how much goes out each month on regular bills and expenses. Once you do this, you will have a clearer idea of how much disposable income you have coming in and if there are any areas where you will be able to cut your spending to increase this.
2. Cut Unnecessary Spending
When you go through your statements to check your income and outgoings, chances are that you might come across some expenses that you may not recognize or did not even realize you were still paying for. Whether it is a subscription that you never use or a gym membership to a gym that you haven’t visited in months, unnecessary spending can often be sneaky and spending money that you don’t need to is something that a lot of people will experience. This is why going through your bank account is a good step to take first since it gives you the chance to find out where your money is going and cancel any payments that you no longer need or want to make.
3. Budget for Different Aspects
Once you’ve gotten a clear view of your income and expenditure and canceled anything unnecessary, it’s time to figure out how much you are budgeting for each aspect of your expenditure. You will need to set aside a certain amount for rent or mortgage, debt repayments, and essential bills. Other aspects may provide you with more flexibility, such as your food and entertainment budget.
When it comes to food and essential household goods, for example, you might want to consider shopping around for a cheaper supermarket so that you can get your usual number of groceries at a cheaper price. It is also a good idea to have a set amount per month that you will spend on entertainment like playing online casino games.
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4. Pay Down Debt
If you have some disposable income left over after you have worked out your budget and are repaying debts, it is a good idea to consider paying some extra towards your debt repayments so that you can clear them faster.
Once the debts are cleared you can enjoy more disposable income each month along with an improvement to your credit rating as most leaders look favorably on making overpayments as it shows that you can afford to repay more than the minimum payment towards the debt. The debt snowball method is a simple and effective method for getting out of debt faster.
Using this method, you will start with your smallest debt first and pay as much extra as you can towards it until it is paid. Then you can simply start paying the money that you were putting towards that debt each month towards the next debt up in size, and so on until you pay off the biggest one.
5. Use Cashback Apps
Cashback apps can be an ideal way to make savings on lots of things. They can be particularly effective when it comes to saving money on your household bills, with various insurance, broadband, and utility companies offering generous cashback rewards when you choose them through a cashback app.
All you need to do is join the cashback app or site and browse to find the company that you want to purchase from. Click on the link and then make your purchase as normal for it to be recorded by the cashback site. You will usually get your rewards in a few weeks.
6. Get a Side Hustle
If your main problem with your monthly budget is that you don’t have a lot of money left over at the end of the month, you might want to consider a side hustle to earn yourself some extra cash.
The good news is that in the gig economy of today, there are more options than ever before for self-employed earning on the side whether you are selling your art on Etsy or working as a delivery driver for a company like Deliveroo or UberEATS. This can be a better option compared to getting a second job as you’re not committing to working a certain number of hours and can completely control when you want to work.
7. Try Cash Stuffing
Cash stuffing is a technique that has been around for a long time as a way to help people manage their budgets. It works by using envelopes that you fill with cash that is to be used for a certain purpose such as buying food or paying bills.
Today, you can get bank accounts like Starling or Monzo that allow you to set up cash ‘pots’ that you can use for this purpose digitally, with the option to pay your bills directly from them.
With the cost of living rising, taking steps to manage your monthly budget has never been more important.