10 Your own budget

You’ve looked at how to build a budget. Now start to have a go for yourself. You can either add your answers into the table below or download and complete a Word version of the budget grid. You can complete and refine this after you have finished this course, particularly as you may have to spend time looking through your financial documents to get the details you need.

A link is provided at the end of the session if you need further guidance on building your own budget.

The image is of someone using a calculator to check their gas and electricity bills. The two bills are included in the image.

Figure 8 Are you paying too much for energy supplies?

Pay close attention to the income and spending categories.

One of the key benefits of a budget is the insights you can gain from it. When you’ve compiled your budget complete the activity below.

Activity 4 Reflecting on and reviewing your budget

Allow approximately 20 minutes for this activity

Part 1 Reflecting on your budget

Interactive feature not available in single page view.

Part 2 Reviewing your budget

Answer the following questions:

Have you got a surplus of income over spending, or do you spend more than you earn?
Are all months similar when it comes to budgeting?
What’s the reason for having a contribution to a savings account or for ‘contingencies’ as an item of monthly spending?

Answer

If you’ve ended up with a surplus of income over spending this is good news. It enables you to save to cover periods where spending exceeds income. If you have an excess of spending over income you will have to cut your spending down, or find a way to cover the shortfall (your savings account?).
No, each month is different. Spending should be expected to peak at key points of the year – at an annual festival that you celebrate with your community, like Christmas, or when you go on holiday. Income is often flat, but may increase if you get a bonus, or your work is seasonal and you get overtime in some months of the year.
This is a good way to embed a savings activity habit into your everyday financial life. It makes sure that you have extra resources to draw on when you make major purchases, or at other times when your finances are under pressure.

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	Current Month	Full Year
Balance from previous period	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Income
Income (after all deductions like tax)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Pension income (after tax)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Investment income (interest etc.)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Other income	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Money from sale of assets	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Total Income (A)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Essential Expenditure
Mortgage or rental costs	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Council Tax	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Water charges	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Utilities (gas, electricity, other fuels)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Groceries (food and drink)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Day-to-day spending (lunch at work etc.)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Essential travel & car expenditure	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Insurance premiums	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Phone & Internet costs (including mobiles)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
TV costs (including TV licence)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Clothing	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Hairdresser costs	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Medical costs (dentist & other)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Home and garden maintenance	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Total Essential Expenditure (B)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Other Expenditure (Desirable/non-essential)
Holidays/optional travel	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Socialising & eating out	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Club memberships	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Presents	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Other spending (not classified above)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Money set aside for savings & contingencies	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Total Other Expenditure (C)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)
Outturn (= balance for start of next period) = Total of A minus (B+C)	(A text entry box would appear here, but your browser does not support it.)	(A text entry box would appear here, but your browser does not support it.)