How do you Budget?

When I was contacted and asked if I would blog about how I budget I was left wondering where to start.

My parents, of course, played a huge part they were never in debt, credit cards were only used to make certain purchases and always paid off at the month’s end. Claiming reward points for shopping still remains the best part of using a credit card

My Past With Money.

When I first moved out of home, I was a smoker trying to live on £15 a week to cover electric, food and water. As back then that’s what the government said I ‘needed’ to survive on. 

When I was 18 the biggest part of how I now budget hit me. I’ve talked of my past a few times, one part I’ve never really gone into through was the financial side the abuse took.

In just a couple of months, he managed to rack up over £20,000 debt in my name.

Back then I had a clean credit rating so it was easy for him to open credit cards and catalogues and mobile phone accounts online – then run up huge bills.

He managed to take my ‘no overdraft’ bank account over £1000 into the red and even managed to change my benefit money from going into my account to his, by just phoning them up. 

Even though we managed to prove it was done fraudulently my credit record was, of course, damaged. Even opening a cash-only bank account was near impossible.

It took me a long time and hard word to not only build up my credit record but also prove to myself that I could trust myself in many areas, money included.

I was asked some questions about my life with budgeting.

What has made you the most money-conscious? 

For me, my past has had the biggest impact, plus my upbringing.

I very much live within my means. Once rent, bills, food and necessities are paid for – treats can come from what is left (if anything). If I  was to have a larger amount come in then I would love to think I would put something into my savings.  

My parents tried their best to bring me up to live within my budget and means.

Do you worry about money?

Yes – there’s probably not a day which goes by when I don’t.

In fact, it’s probably the one thing that keeps me up at night. Even though I know my bank balance down to the pound (rounded up) at all times, and know everything should be covered I worry about the unexpected, and the ‘what ifs’.

Do you think there’s enough education around money planning and budgeting for younger people / young families?

No, I really think it needs to be looked at in school. It’s all too easy today to spend without thinking of the consequences.

So much today is brought on credit; with loans and overdrafts, people can so easily end up in debt. Without really knowing just how much they have spent, after all it’s the name as paying in cash.

I believe that education does start at home. Pocket money, for instance, it a great way to get kids used to saving. However, if you spend everything you still have a roof over your head and food in your belly. So I do believe some sort of education on it should be made mandatory in school. Alongside learning about pensions and investments and other financial services.  

When budgeting, do you factor in saving for the future?

Sort of – I have a LISA, which automatically rounds up payments and takes them weekly. It isn’t the best set up. However, it works for me and I am at least saving something for the future. 

I do also send another account some money every Monday. This is my “rainy day fund” or to be used when anything breaks. 

It has taken me a long time to get these habits in place though and the automation of technology and phone apps has been a big help. 

How do you budget? 

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