Hello everyone, it has been an eventful month with lots going on, so I am sorry for not having posted recently.
June has allowed me to take some time to analyse spending for these past 5 months and compare to previous years. The results are pretty amazing, even though I do say so myself! I hope that by sharing this information it might inspire you to get more out of your budget and put aside more even if just a little, for a rainy day. All savings in this economic climate are valuable protection against the unknown future.
Some years ago I set up a Budget spreadsheet and on it I log the 'extras' we buy, ie: the non-essentials. I have one spreadsheet for me and one for the joint spending. On my personal spreadsheet, I can see the following:
TOTAL Personal'Frills/Non essentials' Spend for the year + Average per month:
2006 - £5365 (£447 per month)
2007 - £3444 (£287 p/ month)
2008 - £3548 (£296 p/month)
2009 - £763 for 5 months (average £153 per month)
So as you can see, there has been a drastic reduction in 'silly' spend since I have started to be more aware of what I was spending on non-essentials and I have focused alot more in the last 3 years. There has been little suffering yet it's saved me an average £2,000 from 2006 to 2007 alone on non-essential spending. Around £294 less spending per month comparing 2006 to 2009!
TOTAL JointSpend for the year & Average per month:
The below include bills and all household spending:
2006 - £5058 (£421 per month)
2007 - £4209(£350 p/ month)
2008 - £4552 (£379 p/month)
2009 - £1652 for 5 months (average £330 per month)
This is a reduction of £90 per month comparing 2006 to 2009, which would be over £1,000 per year in savings if you averaged it out!
Now we are leading a more purposeful life and saving more, and inflation has not affected our joint finances because we have been more creative, therefore allowing us to put exactly the same money in every month since 2006 (£400 per month) and even take money back out into savings at the end of the month. This goes towards our house deposit fund and the way I see it, each £10 saved is another couple of pillows or money towards durable items like good quality pans, growing our own veg etc.
For 2009, I have spent £52 on clothing in the last 6 months, and £30 on charity, almost half of my clothing spend! Lunches and naughty snacks have cost me £95 which is shameful and I want to reduce those much more...
www.spendingdiary.com is a great site you can use if you find budgeting boring or hard to do. It really helps.
Personally, I like to take out £100 in cash on the 1st of the month, allowing myself another £100 in the bank 'just in case'. My £100 in cash has to cover everything that is not a bill. Going out, clothing, snacks, magazines, books and dvd's, all the fun stuff. I then make a note of what I have spent in cash and when, normally on my way home from work in a quiet moment.
Normally, the other £100 stays in the bank for times when I need to pay for something via debit card, but most times, quite a decent amount of that is left in the account at the end of the month, maybe £60 is left. I either save this, or sometimes buy shares or take it out and keep it at home for special treats like going out for dinner or a movie.
So by using this ATM machine rule, I have saved around £300 so far this year, proving that my thoughts last year that I 'couldn't possibly do any better in 2009' wasn't true...
Any extra cash I have come in (on top of my wages) from cashback sites for example, goes straight to savings, I have trained my mind to not even think of it as real money. I also would never consider buying anything off the highstreet now *IF* I can buy it online through a cashback site. See my Cashback Sites section on the right for more info on hwo this can save you some money.
I hope that this inspires you and if you are a homemaker or work a full time job, there are savings to be made in small tweaks here and there that do add up. Make a start, see how you like it and then try and challenge yourself week by week... perhaps keep a log if this motivates you.