We're often tempted to put off the business of budgeting until tomorrow. We tell ourselves we'll start next week or maybe next month. Then, when we finally work out our budget, it often doesn't go to plan. We tend to spend more than we thought we would, and our buffer - that surplus of income over expenditure - erodes to nothing.
Sound familiar? Don't worry, you're not alone. But whether you like it or not, making a realistic budget - and sticking to it - will help you take control of your money in the long run, so you can get on with enjoying life.
Here's how you can do it:
For most of us, this is a matter of checking our payslip or salary credit and seeing what we get (after tax and super).
It's trickier if you're a contractor or self-employed, or if your income varies wildly from month to month, so you may need to use your last tax return to work out your weekly net income (after business expenses, GST and PAYG).
This is slightly more complicated - and easily underestimated. But getting it right is key to accurately calculating how much you're spending, and creating a budget that actually works.
Start by taking a good hard look at your bank statements. Go back over the past two or three months (don't forget the hefty costs that only come up every year - or less) and start recording your expenses in real time so you don't forget anything.
With your income and expenses written down in black and white, it's time to start grouping them into categories.
Here are the basics - mortgage/rent, food, clothing - along with some essentials - utilities, transport and insurance. Start by figuring out which expense goes into which category
Then there are other easily overlooked categories.
While setting a budget may seem daunting at first, once you start working out the finer details with our budget planner tool you'll be able to gain a much clearer idea of where your money is going. Then you can take the control you need and live your life to the full.