WHETHER YOU’RE SAVING for a big purchase or want to stop leaving yourself counting down the days until payday every month, a budget is a great way to get a grasp on your finances.
Unless you’re someone who’s never a penny short, it’s almost certain that most of us could benefit from looking at exactly where our money is going each month – and figuring out where we can save. In fact, Irish households saved nearly €10 billion in the first seven months of this year due to an ‘inability to spend’ during lockdown.
So, what’s the best way to keep a hold on your expenditure? From spreadsheets to putting loose change into Coca Cola bottles, we asked eight Irish men and women to share the budgeting tips they actually stick to.
Here’s what they had to say.
1. Separate your essential and non-essential spending
In our house we do up a budget specifically for shared defined outgoings (but you could do this even for one person) where we figure out how much we need to pay each month for things like mortgage, insurance, joint savings, estimated groceries etc. We each have a direct debit then set up from our personal accounts to put half of the total (with a bit extra for unforeseen expenses and holidays etc) into a joint account.
The direct debit goes out at the start of the month, when we have both been paid, and it means that when you are considering some piece of discretionary spending for yourself, you only have what’s in your personal account to play with – and you know the big stuff is already accounted for.
- Susan
2. Set up a direct debit for savings, no matter how small
I think a big thing is having a savings direct debit that goes out either the day you get paid or the day after, so the money barely has a chance to hit your account. Even if it’s really small, it doesn’t matter. Also, open a credit union account and save a small amount every week. You can use that as your Christmas/unexpected expenses/holiday savings account if you need, or just watch the money accumulate.
- Aoife
3. Break your spending down into categories
Categorise your spending as much as possible. I use a spreadsheet to do this, but you could use an app or notebook. Make the categories broad initially and then you can narrow them down as time goes on, but I think it helps just mentally to see where your money is going in this way.
- Nicky
4. Set a realistic limit for ‘fun’ purchases
After I put away my savings and calculate the cost of my direct debits, each month I put a certain amount into my Revolut account and use this as the ‘only’ money I have until next payday. I use this money to pay for any luxuries like online shopping, drinks out with friends, takeaways etc. I set a realistic amount so I can afford to do the things I love, but it stops me from spending too much and dipping into my savings.
- Jennifer
5. Put your loose change to good use
We have a big plastic Coca Cola bottle in our house and put every bit of change into it. We usually use it towards a holiday during summer then start again for Christmas. The kids love seeing it build up, and whenever we use the money we tell them, ‘the money from our bottle paid for this!’ They love to guess how much is in there and then we count it to see who was closest.
- Ciara
6. Set a reminder to check your bank statements
I put a monthly reminder on my phone to log into my bank account for even five minutes to check and make sure I know exactly what direct debits came out, and if there was anything I wasn’t expecting. If I have more left in it than I thought, I’ll give myself a “bonus”, which is great!
- Rebecca
7. Make a ‘savings club’ with your friends or colleagues
In work we have a savings club where one person collects money weekly on a Thursday and Friday morning. You can save whatever amount you like. It runs for 48 weeks and you get your money back on the first week of December. You can’t get it back before then! It makes you accountable and it’s nice to have a little pressure to save.
- Jaimie
8. Divide your paycheck into a daily spend
Say it’s the 10th of the month and you have €1,000 in your account after putting aside money for bills, rent, saving. Divide the €1,000 by the remaining days in the month (say 20), meaning you have €50 per day as your spend. Especially now, working from home, you won’t traditionally spend €50 on an average Tuesday, so allow any excess to roll over to the next day, and the next etc. By Saturday, you could have a possible extra €50/€100 to add onto your Saturday or Sunday €50 budget, meaning you can go out to dinner or buy something nice. Any roll over at the end of the month goes into a savings account.
- Roisin
Want to get a handle on your budget? The Competition and Consumer Protection Commission (CCPC) budget planner Money Tool can help you work out exactly what you’re spending your money on, and help you set up a plan to keep control of your spending. Try the free, independent budget planner, and check other Money Tools from CCPC here.
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For me and several of our friends our problem is that our husbands seem to “need” a lot of unnecessary technology, watches, cars that are not the cheapest even though the cheapest perform the same function. This creates tension when trying to save. My philosophy is that if I don’t need it I’m not buying. I would rather save for house deposits for our children than buy myself anything.
@SC: I could just as easially say my problem for me and several of my friends is our wives “need” to spend money in Penny’s every week.
They “need” another top or pair of jeans yet have plenty already where as a lot of “husband’s” will wear the same pair of jeans they’ve had for years till they wear out
If you’re putting money away for very long term savings and not making additional pension contributions (AVCs) please consider changing strategy. AVCs are not taxable up to a certain point and may be a better long term strategy.
Seriously? A monthly reminder? Surely you want to check your account more often!
@Lovely Lapinette:I log in several times a week. Just always keep an eye on things
Use YNAB – I’ve been saving thousands a year with it just by making better decisions and having more data. I will never go back to life without it.
@Richard: We use YNAB too. We are out of debt completely and have money in the bank. Complete pain in the bottom to set up – our problem not theirs – but now the work is done it is the best thing I ever did – even better than giving up smoking. I’ve always tried to lever myself out of debt but the technology let me down over and over again. The time is right now – other software is available.
@Richard: YNAB?
@Berkieahern3: it’s a budgeting software/website. Many people swear by it. But at the end of the day it’ll only work if you are committed to it.
Dear journal, when you say you asked men and women about their saving habits did you mean only women? Don’t see any blokes coming up with ideas? Not to bring the sex stuff into it just curious why was it written as such
I’ll never touch DD ever again & id suggested nobody else does either! The biggest crooks in the country are the banks!
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