Hello,
I'm about to start reading the Barefoot Investor and need to create a budget. I'm ashamed that I've never really had one and need to sort my finances out as I'm not saving enough and have 2 debts that I'm trying to get on top of.
Is there an organisation or an individual that could help with this, please?
Edited: I'm hopeless using EXCEL.
Is it not something you can do yourself? Will help if you can use excel. Start with a blank spreadsheet, list your income(s), and list all your outgoing bills that aren't negotiable. Use the calculate function to break stuff down into a more manageable period, I go by the week but its probably best to match it to your pay cycle. Once you get your total bills amount, set your bank up so its split off into a separate account as your pay comes in.
Youll end up with a leftover figure of disposable income, work out how much of this you want to spend on leisure and have this split off into your spendings account. The rest can go into savings/onto loans etc. If your half switched on with finances youll start to get an idea at this point of where your money is going and the rest will fall into place.
Failing this, there are companies that you basically set up so your pay goes to them and they give you a little to spend each week and they pay your bills etc. Its an expensive way of doing what I described above.
Go pver your bank statements to see where the money is going
This works for me. It gives me a monthly reminder when to do the budgeting, as with other systems I slack off over time.
I pay for everything on a card or bank transfer that I can, get a bit of cash for play money (though less necessary these days).
I pay the mortgage, utilities etc. and can see if utilities deviate much from usual.
Can see petrol, groceries etc and quickly get an idea what is going on.
Biggest benefit is being able to say, oh, I did spend a lot on entertainment or take away or beer or whatever last month. This allows me to be more disciplined about putting off discretionary spending (e.g that's a good deal on OzB, but I have already spent a lot this month).
So I don't run a set budget, so much as one that changes my spending depending on what has been going on recently.
It also seems manageable to me to be able to say "I can't buy that now, but next month I will be able to look at it again if it is still a priority".
Over time, I have also built up some savings for discretionary purchases (like towards a replacement computer or phone) so I don't have to absorb bigger expenses all in one month. This is apart from savings toward a goal, and is where I put aside that bit of "play money" that remained unspent some months.
AMP used to have a really powerful spreadsheet for their Budget Planner.
It is now a web based form.
https://www.amp.com.au/banking/calculators/budget-planner-ca…
This is a good start.
Or if you are proficient in Excel, use that, it is more powerful than most app out there.
Look and compare against your two most recent bank statements
$$ last period and $$$ now= $ savings
Start with looking at this way first to get a rough idea what you spending. Once you know, you can slowly decrease/reduce spending in areas accordingly.
Income - Expenses = Savings
The aim of the game is to
a) get income higher than expenses
b) get expenses to be lower than income
c) magically win/inherit/invest to generate higher income and/or savings.
Everybody is different. No right or wrong answers.
https://moneysmart.gov.au/budgeting/budget-planner
Download the spreadsheet. All you will need to do is put in numbers.
+1 for this one
Look at your bank statements and make a list for needs (eg bills) and wants (eg. Foxtel, asos). Imo it's best to have a magic understanding of your spending, rather than rely on someone else to do it for you.
Hey Josh, is that you ??
If you suck at Excel, start with a pencil, paper, ruler and a calculator. Can be easily done.
Upvoting this because seriously what do you think we all did before computers?
If calculator is too hard, you can always use your fingers and toes.
I use pocketbook on my phone but it also works in your browser. It connects directly to your bank(s) or credit card(s). You can set it up per category e.g. You only want to spend $30 per week on takeaway meals. It takes a bit of "training" but you can teach it to categorise expenses as tax items then it will spit out a report at the end of the FY.
You can also factor in bills you know about that come in monthly like Netflix etc.
Been using it for ages. Highly recommended. Also, there is an app, I think it is iPhone only called "daily budget". Also highly recommend. I paid for it and it was only because I really thought it was great and I like supporting small devs.
+1 to Pocketbook. I personally would use it in OPs case as a way to go through all their accounts and classify different expenses so you can see where all the money goes, gives something to base a budget off.
Do these types of App work on credit cards or is it just on bank statements?
My Amex feeds directly into pocketbook.
Works for credit cards. You log in with your bank account and it pulls it straight away.
I'm not a very strict budgeter, so the fact that I can look at my Amex and debit card in the same place is super useful.
Christ is the only accountant youll ever need
Yeah whenever I see my bank statement I always shout at my wife and say "jesus christ, what have you been spending money on this time!!!"
Op, you can google free financial counseling, I believe some charities have it. How much is your debt relative to your income? I suggest you don’t spend another discretionary cent before you pay down your debt. That’s your budgeting 101.
My debt is 7.5k… soon to be double due to braces for my son :(.
I understand expenses related to braces too well unfortunately. Make a shopping list before you go grocery shopping. Try getting help with your electricity and gas bills, especially with your winter bills.
Folding A4 in half. Monthly income on one half. All expenses on the other half. Sets it out clearly. This was accounting before Excel.
Start sketching on a piece of paper, right down a list of expenses and put them into categories (rent/travel/mandatory/discretionary) and run through your bank statements to see if you miss out on any items
You will be surprised how much you spend
once you have a clearer idea then move to somewhere easier for your tracking, i.e. excel/phone app
Generally what i do is i know how much I spend roughly each month, and when the pay comes in, i put (Salary - expenses) to the saving acc straight away
I'm with NAB bank they have a money tracker for my account very simple its an income vs expenses jobbie, expenses are auto split into categories like fuel, groceries etc may need some ordering with online shopping etc but its a start, most banks should have one?
The best individual is you. Before setting a budget, you first have to know what you are spending on. Once you know your spending habits, you start trimming where necessary. Start with an app to keep track of your transactions for a month. Categorize the expenses into stuff like meals, groceries, home loan repayment, interest, entertainment, shopping, transportation, utilities etc. I'm using an app called PocketMoney. It is pretty good, I've been using it for over 5 years now but it might be a bit complicated to set up.