How to Live on a Budget

Are you struggling to stick to your budget? Do you find yourself overspending each month? Here are the tactics I use to live on a fairly restricted budget.

My decision to take an extended career break, to spend a little more time at home prioritising my family, has obviously impacted our household income. Even though we lived frugally before, we now have a carefully planned budget to adhere to each month.

These budgeting ideas are therefore written from the perspective of a family managing on one income instead of two. But they are applicable to anyone who is trying to minimise their outgoings!

Understand Your Monthly Income and Outgoings

This is the backbone of any serious attempt at budgeting. You must have a good handle on your monthly income and expenditure. And if you are budgeting as a household, then honest communication between all parties is a key starting point,

It is a good idea to keep a spreadsheet of your gross and net earnings, especially if you have more than one income stream.

Also keep a spreadsheet of your monthly and annual expenses. This will help you to keep track of all your bills and other essential outgoings. And you can monitor your spending over time.

Once you know how much money you have left each month after meeting your key outgoings, allocate some of that remaining income to savings. Endeavour to move that money across to your savings account as soon as you have been paid.

Stay Away from the Shops

This sounds obvious, but if you are really trying to cut your spending, stay away from the people who are desperate to take your money!

With the best will in the world, going window shopping is usually not just that. Shops set out to maximise the chance of you buying something, whether you need it or not. So if shopping has been your main hobby, now is the time to find another way to fill your spare time!

Instead of going shopping “just to have a look,” I keep a list throughout the month when I find myself wanting or needing something new. Then on the first weekend of the following month, I review my list. If the items still represent an unmet need, and I have the budget available to make a purchase, then I buy those things. If, however, those items where just fleeting fancies, then I cross them off my list and move on!

Make Do, Mend or Make Your Own

The best way to avoid spending money on new items is to take good care of the items you already own. It is well worth investing a little time in learning how to sew on replacement buttons and darn holes in fabrics. Keep some super glue handy for other repairs.

You may even take this a step further. Show your creative side and customise or alter pieces of clothing or other household items!

But most importantly, before you decide to buy anything new, take stock of your inventory. Do you already own something that would do the job? Or something that could be adjusted or adapted to fit the bill?

Do you have the skills to make your own clothes? Or perhaps your children’s clothes as they grow? Could you make your own gifts for your friends and family at Christmas? Most people really appreciate the personal touch of homemade gifts, and you will likely save yourself a pretty penny!

Grow Your Own

If you have green fingers and a little bit of outdoor space, growing some of your own food can save you some money off your grocery shop. It will also have the added bonus of being organic (as long as you avoid pesticides and other chemicals). And zero food miles, to boot!

Home Cooking and Baking

Convenience foods and eating out are much more expensive than cooking at home with basic ingredients, especially if you are able to grow some of those ingredients yourself!

The key here is to find a rhythm that works for you. If you’re a planner, you might want to plan out your meals for the week and prep as much as you can in advance. Make sure you take lunch and snacks with you whenever you’re out and about. And don’t forget your water bottle and flask of coffee!

If you prefer to improvise, keep your kitchen stocked with the basics and throw things together on the fly.

Either way, cooking from scratch will keep you on track with your budget. And you will be fueling your body with healthy, home-cooked food!

Zero Waste

Time

I think it is important to recognise that time is a limited and finite commodity. When you are living on a restricted budget, make the most of every moment you have available to you. Anything that you can do yourself, instead of paying someone else to do, is money saved. The more efficiently you are able to plan out your day, the more efficiently you are able to complete your tasks, the more productive you can be.

Resources

It is also essential to remain mindful over the use of resources. For example, ensuring you are appropriately dressed for the weather before turning the central heating on or lighting the fire. Using water judiciously. Only boiling the water you need in the kettle, turning the lights off when you leave the room, short showers and running the washing machine only when you have a full load. Finding reusable alternatives to single-use products such as aluminium foil and cling film. Walking or using another form of active transport, instead of taking the car.

All of these resources come with a financial cost, as well as an environmental one.

Nature is Free

If you are trying to save money, the Great Outdoors is the best place to spend your free time. Cancel your cinema pass and your gym membership. Being outside in nature, moving your body and breathing in the fresh air, is SO beneficial for your physical and mental health. And the added bonus is that enjoying nature is FREE!

Stay Out of Debt

Getting into debt is a slippery slope. Just putting a few expenses on your credit card so that you can pay it off next month can quickly spiral out of control.

I would strongly advise using the above steps to cut back on any unnecessary expenses, to avoid accruing any debt.

I hope these tips have been helpful! Leave me a comment – I would love to hear your thoughts!