If you look after the pennies the pounds will look after themselves. That’s was one of my mother’s favourite expressions if I ever complained because I couldn’t afford something I wanted. While, I’d admit, it wasn’t appreciated at the time, the general significance hasn’t been lost on me now I’m older. As the cost of living increases we all need to find ways to make our budget stretch.
Take an overview of current spending
Look at everything you spend money on over the course of the month. You could just make a list on a sheet of paper or set the details out on a spreadsheet. You may need to keep hold of you monthly shopping lists and use your bank account statement to get an idea of casual spending using contactless payments.
If you’re using a spreadsheet you could use headings to help you catagorise your expenditure. For instance you might list information under date, description and amount. But instead of saying the name of a cafe under the description heading when listing coffee purchases you would just type cafe. That way you could sort all the information once complete in alphabetical order, grouping the cafe purchases together. This would enable you to calculate the total over the one month period spent on coffee, etc. alone.
| Date | Description | Cost |
| 14/03/23 | Mortgage | £750 |
| 15/03/23 | Clothes: Jacket for work | £45 |
| 15/03/23 | Cafe | £4 |
| 16/03/23 | Cafe | £4 |
| 17/03/23 | Cafe | £4 |
| 18/03/23 | Transport: commuter train | £160 |
| 18/03/23 | Lunch: sandwich shop | £3.50 |
Changing habits
Once you have a clear idea of where your money goes at the end of each month you can start to work out how you can make savings. Separate out the necessaties from the luxuries. For instance you may be buying your lunch because you don’t have the time to make it in the morning.
Look at your morning routine. These are your habits, such as making yourself a coffee after getting dressed. Try stacking your habits. So after you’ve made yourself a coffee you butter the roles or slices of bread for some cheese and tomato or other filling. You’ll likely have finished making your lunch by the time you’ve had your coffee. If making a coffee or tea is the new habit it may mean you are less inclined to buy a coffee on your way to work.
You can stack any of your habits, whether they be those your do when you finish work, just before you go to bed or when you wake up in the morning. If you link new behaviour to exisiting habits they are more likely to stick.
Consider alternatives
Remortgaging for a better deal is perhaps obvious. Another might be to look at your commute. If you drive yourself, perhaps offer a car share for colleagues who live nearby or look at public transport options. Cycling is encouraged by many employers these days if you live within a reasonable distance. Or if parking in a city is a problem you could perhaps take public transport to a point just outside of the city and complete your commute on your bike.
Look at alternative options when it comes to shopping for clothes. There are many online platforms to sell items of clothing you no longer wear and purchase good condition, recycled clothing from others. Vinted.com, Poshmark.com and Wallapop.com are all examples of online platforms which would enable you to do this.
Dealing with debt
If you have debt, other than the mortgage, that is weighing down your finances consider amalgamating them in to one place. For instance you could look for a low cost loan to pay off all your other debt. Or you could search for a credit card with a 0% interest balance transfer offer. Then transfer all your debt to the credit card and work out a more manageable monthly repayment amount to clear the debt. Money Saving Expert provides useful information on how to manage debt and gives some useful links to free debt counselling.
And finally…
Whether it’s the economy, a growing family or just life in general, most people experience times when making ends meet is a struggle. Managing your finances is a life skill. Taking the time to brush up on your skills and knowledge to help to make the budget stretch to your needs always pays for itself in the long term.