Budgeting Tools – The Basics
To begin we need to understand what a budget is and also what budgeting tools we can use to help us create one.
A budget is essentially a record of a person or persons income and expenditure over a given time period. Most people who budget tend to do it over a course of a month so that they can see what they spend against their monthly salary income.
To record a budget most people still use pen and paper however with the advance of technology there are a whole host of software and apps that may make your life easier if you want to follow that route. The choice is yours in terms of what tool you think will aid you best, below is a brief explanation for a few of the budgeting tools available;
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Budget Planners
If you use a pen and paper then a budgeting planner might be ideal for you.
Budgeting planners are good because there are so many different options to choose from.
You can find a planner that works specifically for you or someone you may be helping out.
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Budget Templates
There are some great budget templates out there, I will share some examples in another article.
A template generally lists out main budget categories on it – electric/gas, water, food, insurance, and car/auto etc – with a further breakdown under each one to help you allocate your money into the categories.
Budget templates are good if you just want something basic, that you can print off and stick around the house suck as a pin board or fridge.
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Spreadsheets
Much like budget planners and budget templates you could always create your own budget spreadsheets, and set them up to how you desire. Popular self-made templates are created within software such as Microsoft Excel as it is fairly accessible.
Use them to help calculate how much money you have over and above the outgoings, utilizing formulas to help you adjust your budget as needed. I will go into depth on the best ways to set up a spreadsheet budget that have helped me in another article.
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Digital Banks
This means banks like Revolut, Monzo and Starling to name a few, traditional bank options are also catching up in this space. They offer fantastic in-app expenses tracking as well as clear receipts and spend classifications so you can see where your money is going. Most of the app only banks have very useful dashboards for users.
I personally use a Starling app, it has a few really valuable functions, one being saving ‘spaces’ which is a bit like jam jarring funds, you name a space i.e. new car fund and add the desired amount of funds to it as and when you can and it is ring fenced from your main account.
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Mobile Apps
Separate from the banking mobile apps are alternate choices of budgeting application.
They enable you to track bills so you don’t miss any due dates. Help you track your spending so you can see where your money goes. Some will also allow you to create your own budget planners in the app where you can easily update your own categories.
Good examples of these that I have personally used are EMMA and YOLT, I will go over these in more detail.
If you live in the US you will have access to MINT which is a great app so check it out, it isn’t available in the UK.