Budgeting – the kitchen sink method

There's a wonderful phrase my dad liked to use to describe a task approached in a down-to-earth, back-to-basics kind of way. He would call it the kitchen sink method.

It meant rolling up your sleeves and getting the job completed in an unpretentious manner, laying a solid, no-frills foundation.

I'd like to borrow his phrase today to describe my top ten tips for basic budgeting. There's no high finance here, just no-nonsense advice for getting money matters under control. Most have been learned the hard way, through belt-tightening tough times.

You might have heard them all before, but if there's anyone reading who's wondering just how to begin untangling frightening finances in these uncertain times, then this one is for you!

Hope it helps
Deborah


1. Create a detailed budget which includes all your daily expenses, bills and regular payments. It should be a living document
which you constantly review and update. Be determined to stick to it, but if you do overspend in one area, revise the budget and cut
back somewhere else.

2. Once your budget is in place, work out what you can save each
week or month then move that into a separate savings account as soon as possible. Don't wait to save what's left over at the end of the
month, plan to save from the beginning.

3. Only buy what you can afford. Credit cards get very scary very
quickly and the debts they run up carry a crazy rate of interest.
If yours are heading out of control - cut them up! If you do choose to
use, be sure to pay off the balance at the end of every month,
before the interest kicks in. Be old-fashioned and save up for a big
purchase, only buy it when you have the cash.

4. Avoid temptation and don't go shopping. I often fail to realise just how much I need a particular item until I go into the store and see it. Then I wonder how I ever lived without it! When you shop, take a list and stick to it.

5. Negotiate with your bank. It's surprising how willing they are to
waive or reduce fees and charges when asked. I've even heard of people successfully asking for an interest rate drop on their mortgage.

6. If you spend less than you budgeted and have cash left over - save
it. Don't celebrate with a splurge and don't leave what you've saved
sitting in your purse. Move it to your savings account or stick it in The Pickle Jar (see our Father's Day Family Room article). Spare cash in your handbag has a funny habit of disappearing.

7. Take your lunch to work. I loathe those statistics that state if you
save $8 on lunch every day, you save billions every month and squillions every year, but I grudgingly admit they have a point. However, put what you save in The Pickle Jar or it will just slip through your fingers.

8. Shop around for bargains to make your money go further. Think supermarket specials, home brand for generic goods and discounts for cash or bulk buys. I wouldn't suggest bartering with the Woollies check-out chick, but many retail stores are willing to negotiate.

9. Wait for the sales. Save those big ticket items for the twice-yearly clear-outs then apply all of the above bargaining techniques to drive the price down even further.

10. Consider buying second-hand or even selling your pre-loved goods on eBay. You'd be surprised how much someone out there wants to buy that full-length nylon nightie Auntie Flo bought for you last Christmas.