I’ve recently been discussing our budget with a few people. We live a pretty frugal life, and it’s the way we want it to be. We budget pretty firmly, but have cash to splurge when we feel the need (like the holiday to Hawaii, where I took the above photo).
These are the steps we took to working out a great budget that suits us.
1. Add up 12 months of bills, we didn’t include big one off payments; such as car insurance, registration, etc. Don’t forget anything. For us this was:
- 2 phone bills
Our total was: $22156.39
We then divided it by 26, as we get paid fortnightly, and I find it easier to do all bills, shopping etc. each fortnight.
Our fortnightly bills are: $852.20
2. Work out how much you need for groceries each fortnight. We spend a total of $200 per fortnight on groceries.
- Aldi – about $70 (Basics – tins, pasta, dried fruit, dried biscuits etc.)
- Butcher – about $50
- Farmers Market – about $50 (we do this shop weekly if needed, and usually spend between $20 and $30 each week).
- Miscellaneous – $30 (10kg bags of flour, Joney’s milk, etc.)
Total fortnightly grocery shop: $200
3. We give ourselves a fortnightly allowance; this allows us each to have some financial independence, and a spot of privacy (coffees, lunches, gifts, etc.)
Allowance is $200 each: $400
The total comes to $1452.20, so we rounded it to $1500.
Each fortnight this amount goes into what we call our ‘bills account’. This allows us to accumulate finances throughout bill-less fortnights, and pay for a lot when we happened to get 5 at once (isn’t it always the way).
We have also been paying for our petrol from this account, which means that we don’t have to do that out of our ‘allowance’, and are therefore less possessive of the kilometres that our cars do. When we started this budget, about 6 months ago, the petrol was an afterthought and by writing this post, I have become aware that we in fact don’t have a lot of ‘spare’ money after bills etc, so it is something that we will need to keep an eye on.
We are also very lucky that we collect our eggs from the backyard; we grow what vegetables we have and have a very reasonably priced farmers market nearby.
Do you have a strict budget? I’d love to hear your tips/tricks!