away in alphabetical/chronological order. But we’re betting it’s not.

In fact, we’re betting your paperwork is lying in a disorganised pile somewhere.

Unfortunately, the first step of budgeting is to get all of this together – that includes all of your bank statements, credit card statements, pay cheques, utility bills etc. It’s hardly the most exciting of tasks, but you’ll feel a great sense of relief once it’s done!

Set up a spending diary
It can be very easy to lose track of what we’re spending where. So to help you understand your spending habits, it’s worth setting up a spending diary – in other words, a list of what you spend where. Every time you take out your wallet to make a purchase, make a record of it. Don’t leave anything out, no matter how small – you’ll be surprised how the little things add up! It’s worth doing this for an entire month to help you get a detailed picture.

Make a claim
If you’re on a shoestring budget, don’t be too proud to claim what you’re entitled to.

2. Draw up a budget

Make a list of your earnings and outgoings
If you’ve already completed task number one of this guide, you should have got to grips with your spending habits.

The next step is to make a list of all your outgoings and earnings. It shows you exactly what you’ve spent your money on – and how much income you’ve gained from different sources (like gifts, salary, benefits or interest from savings).

Once you have a couple of months’ information, use it to calculate your income as an annual figure rather than monthly, because monthly figures can vary considerably – for example, you might be paying out for a holiday one month, or Christmas presents the next. Once you’ve worked this out, include any regular annual expenditure on things like insurance policies. Then divide the result by 12 or 52 to figure out average your weekly or monthly expenditure. (If you don’t fancy doing all this on your own, we can help. Contact us for a free financial review.)

3. Cut back!
Once you’ve done all this, it’s time to ask yourself the big question. Are you spending more than you earn?

If, much to your horror and disbelief, the answer is yes, you’ll need to tackle this head on. To do this, it’s worth examining your outgoings to see whether you can make any cutbacks.

It’s important to be realistic when you’re doing this – don’t set yourself an impossible task that you know you’ll never stick to. Set yourself a budget which allows you to set a monthly budget for any specific category (such as petrol and fuel). You can then track your progress through the month against the budget you set.

4. Make use of your leftover money
If you’re lucky enough to have some spare cash at the end of each month, don’t leave it sitting in your
current account, tempting you to spend it. Instead, move it into a savings account. It’s worth setting up a standing order for this so that the money moves out of your current account and into your savings account before temptation strikes. Alternatively, use it to pay off your debts.

Don’t forget you should review your budget on a regular basis to make room for any changes in your outgoings/earnings – for example, if you receive a pay rise, or your landlord increases your rent. Reviewing your budget will also help you to assess whether you’re on track with your finances.

5. Get a better deal

Squash those interest payments
If you’re on a tight budget, it’s particularly important you cut interest payments wherever possible. So if you’ve got a lot of debt on a credit card, see if you can transfer it to a
card or loan with a lower interest rate. Just remember that you’re still paying interest, so it’s important you clear your debt as quickly as possible.

Slash your energy bills
Make sure you’re not paying more than you need to for your gas and electricity. If you’ve been on the same tariff for a while, it could pay off to hunt around for a better deal.

Shop around for better broadband and phone deal
Taking the time to shop around and find a cheaper broadband/mobile phone provider can really pay off and you could find yourself saving hundreds. 

6. Make cutbacks

Make your own lunch
Instead of buying a sandwich every lunchtime, simply make your own and take them into work.

A €2 packed lunch, rather than a €6 bought lunch, will save you €92 a month (based on 23 working days).

Ditch the coffee
If you currently buy two coffees costing €4.00 a working day, you’ll make a saving of €92 a month by giving them up! Why not simply invest in a flask and make your own coffee at home to drink on the way into work?

Scrap the luxuries
Finally, get rid of all the luxuries you don’t really need.
This means cancelling the digital TV subscription, the gym subscription and the magazine subscriptions. Giving up smoking and cutting back on the booze will also save you a packet.

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