Children seem to come with many expenses such as school fees, buying new clothes for growing kids and toys are just a few things that can be added to the list. Whether you are pretty comfortable financially or have to be a bit more careful, it is always a good idea to have a budget in place. That way you know how much you are spending and how much you are saving.
So, how do we get around to creating a budget? Firstly, start off by writing your net income, this is your income after tax. Include all forms of regular income such as benefits you may be receiving or any external sources of income. If you do not earn an exact amount monthly, try to average it out. Once you know, the amount that is coming into your household, you can list your expenses. These include rent, car payments, extra curriculum activities or private lessons. Your expenses can be divided into regular monthly ones such as rent which is paid every month, yearly ones just as road tax and more regular ones such as dentist appointments that happen twice a year and haircuts for children that could be three times a year. This way you’ll have a rough calculation of all that you will be spending in a month/year. We suggest that you calculate how much money you’ll be spending in a month and don’t forget to set a minimum of saving money monthly.
Saving money doesn’t need to be in the hundredths. 50 euro a month goes a long way. Having savings which are for emergencies is crucial to avoid getting into debt. Many people end up loaning money due to unexpected emergencies such as car repairs or malfunctioning appliances.
Cutting expenses is easier than you may think. Do you buy a coffee before work every day? Do you eat lunch out every day? How much does this amount to? Let’s say your morning coffee is 1.50 euro and you have it Monday to Friday. Well, that amounts to roughly 30 euro a month. You could be saving that by making coffee at home and maybe treating yourself to one coffee a week from an establishment rather than for the whole week. These small expenses add up.
Do not give up! Many people write out a budget and end up not sticking to it after a month. Budgets take a while to master and you’ll need a couple of weeks to see results.
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