Benefits and Money

Getting Started with budgeting

Knowing how much money you have and how much you spend is key to understanding your budget. If you don't know these 2 factors you are at risk of spending more than you have coming in and getting into debt. To understand your budget you should;

• Get together your monthly bank statements and receipts. Don't be tempted to guess or estimate. Accurate incomings and outgoings are the only way you can be 100% sure of your budget. Getting all your statements and bills in front of you in black and white means you can see exactly what these figures are. You also need to think about any bills you pay quarterly or annually like TV licence, Car Tax etc
• Understanding the difference between Credit, Debt & Spending. Credit is where a customer can obtain goods or services before payment, based on the trust that payment will be made in the future. So a credit card or a hire purchase agreement has a defined time period in which to be paid. Debt is money owed that you have either broken your agreement (credit) or that money that you have borrowed in cash or purchases but have no income to pay back in full. Spending is simply the act of paying money out for goods or services.
• Use a free budget planner. There are numerous planning tools available on the internet. You will need to understand your total income (money coming in) first. 
• If you find you are in debt. Don't ignore it. Debt can easily spiral quickly if you continuously spend more than you have. There is support out there and people who can help.