Random Thoughts

Financial Fitness 2016: Budget

I’ll put it out there. I’m not good with finance.coins-1015125_960_720
Never have been. I can safely admit that.

However, having two kids to look after has forced me to  evaluate the way I use my money each month. There was no more spending money on every left and right activity. It was time to switch my mindset to saving instead of spending.

With two salaries coming in, I couldn’t understand how we were sitting broke by the end of the second week. There was no making sense of the situation. Previously we didn’t need to worry about paying for fuel because Byren’s previous employer took care of that. Today we need to put this into consideration when planning our budget as the responsibility falls on us now.

So at the beginning of the year, Byren {hubby} and I sat down to draw up a budget. It was a must. It was time to take the veil off the problem and solve the mystery of “Broke by Fortnight”.

We started off with the calculation of all the debt we have on our names. We used Excel to draw up the budget, thanks to the awesome formulas built in.
We placed each debtor into their own column with the monthly amount next to it. We also included the total amount outstanding as a reference to see how much we still owe.

This helped us see how much in total we have to deduct from our monthly earnings to apply to the debt.

The next step was to write up the groceries list, the full one. Each item on its own line, with its price next to it. The prices usually change by a small amount so it doesn’t really mess up my whole budget. In the past, I would buy doubles of items, you know “just in case” the next month wasn’t a good one. I realised that I was actually spending more than necessary each month, a lot more than necessary. Now I only buy what we run out of. Whenever we run out of anything, I add it to a list of items to replace. This way I don’t miss anything I need to buy at the end of the month. It helps a lot with sorting what you buy that is unnecessary and helps you stay on topic.

I do the same with the kids’ items. I only buy what is needed.  I have a good idea of how much of everything is used in a months time and I buy according to that. {It works – I haven’t faced any issues in two months.}

When working in such a way to control your finances, you have a clear view of how much you are spending on useless things and how much is spent on your needs. Another thing to remember is to buy in bulk! I cannot emphasize this enough. It’s cheaper to buy your groceries in bulk on a monthly basis than buying supplies every week or every second day.

So this is how I started saving monthly and keeping track of our finances. We are still looking to see where we can cut on groceries as some groceries that I purchased sometimes go unused and it turns into a waste of money.

At this point in time, I’m busy working on a meal planner. This way I can work my groceries around the planner and will be able to save even more in the long run, without sitting with wasted groceries and crying over money ill spent.

That’s my financial fitness plan for 2016. What is yours?

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