BETTER YOUR BUDGET

HOW TO CREATE A FOOLPROOF HOUSEHOLD BUDGET – AND ACTUALLY STICK TO IT!

With living costs these days feeling like an endless pile of expenses, setting yourself a realistic budget can be tricky. Alya Stephen, chief operating officer of Sorted Services, shares her expertise on how to create a budget for your household that you can actually stick to.

IDENTIFY YOUR GOALS

The best place to start is by setting up goals to help plan your finances. “Your goals should identify what you want to do that requires you to budget and save; when you want to make the purchase or spend the money, and how much money you will need (both total amount and how much that breaks down to on a monthly basis),” explains Alya.

“Some common examples of goals could include anything from buying a new refrigerator, retiling your bathroom or even funding a renovation.”

WORK OUT INCOME SOURCES

“It may seem obvious, but it’s a good idea to work out where your income comes from and how regularly you will receive your pay cheques,” suggests Alya. “Not only will this help you work out the time frame needed to achieve your goals, but it will also give you an estimate of how much funds you have at your disposal for your budget.”

DETERMINE FIXED COSTS

It’s then time to work out your fixed household costs. This involves “any expenses that remain the same from month to month (week to week, fortnight to fortnight, etc.),” explains Alya.

“This can include your rent, council rates or body corporate fees, and renter’s and portables insurances. It’s generally much easier to budget for fixed expenses as they are charged regularly. This means you can efficiently plan for them and be able to estimate how much they’ll be.”

CALCULATE YOUR VARIABLE EXPENSES

This refers to the expenses that vary from month to month such as electricity, gas or water bills. “You can try to adjust your variable expense bills by doing your research into utility providers,” suggests Alya.

“Depending on your location and usage, you might be able to negotiate a better deal or added perks than what’s advertised, and minimise some of the costs you need to add to your household budget. On the Sorted Services’ app, you’re able to browse different utility providers, pick a plan that suits your budget and usage, and select your connection date ready for when you move in.”

BE REALISTIC!

“It’s crucial to allow for a bit of extra spending each month,” explains Alya. “If you don’t do this, this is where you’ll often break your budget. Whether you want to spend a few extra dollars on new plates, groceries or even takeaway – allow yourself to have some ‘fun’ breathing room.” Alya also recommends putting aside some money into an ‘emergency fund’ for any accidents or urgent repairs that may arise in your household, such as breakages or plumbing issues.

The Sorted Services app is available to download on Apple IOS and