Yearly budgeting will guarantee you have enough money saved for those important events that come around every year. Christmas, birthdays and holidays can really make a dent in your budget - but planning for these ensures your finances won’t be left reeling.
The basics of budgeting lie in one simple rule: staying organised. Take some time to gather all your financial documents together, including include payslips, bills and receipts. Use this information to identify the general categories (food, utilities, travel) you spend the most on. Breaking down the amount you spend on each category weekly will highlight the areas where savings can be made.
Once you identify items you can spend less on, do some research – shop around to find cheaper utility providers, switch supermarkets or brands to save on food spending and think about cheaper forms of travel like walking and cycling.
Set a budget for each category, including important yearly events, and stick to it. It’s important to be realistic when setting a budget. Don’t factor in possible future bonuses or pay rises - base it on your actual income as it stands. Similarly, try to avoid over counting the costs, as this can also lead to inaccuracies in your budget.
Start Planning Early
Once you have gained a better understanding of your budget it’s far easier to work out the amount you can afford to spend on important yearly events. Buying decisions swayed by last minute sentiment and rushed choices can all be avoided if you plan ahead.
Save money by shopping all year round for decorations, presents and imperishable food. Christmas sales are great places to pick up presents for birthdays in the coming year, and even for next Christmas. Be kind to your budget - you can often find holidays at lower prices if you book early or are free to go at off peak times.
It’s important to keep tabs on your expenditure for these events as it’s easy to lose track of your finances when buying items over the year.
While budgeting allows you to plan your finances, at some point in the year you might be hit with an unexpected bill that must be paid before your next payday. If you have a regular income and are confident that you will be able to repay once the loan period is up, a short term loan could help keep your budget in check. You’ll face no extra charges or hidden fees if the loan is repaid on time.
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Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk