As the cost-of-living skyrockets, you may be thinking about how you can save a few extra pennies. Having a budget helps you keep track of your bills and expenses and work out where you can save a little extra.

To get started with your budgets, follow these simple steps.  

Record how much money is coming in and when. Work out an average amount to record if you do not have a regular income.

Make a list of all the money coming in, including:

• How much
• Where from
• How often (weekly, fortnightly, monthly, or yearly)

This money could be from your wages, pension, government benefit or payment, or income from investments.   

Regular expenses are your needs - the essential items you need to pay for to live. These include:

Fixed expenses, for example:

• Rent or mortgage payments
• Electricity, gas, and phone bills
• Internet bills
• Council rates
• Household expenses, like food and groceries
• Medical costs and insurance
• Transport costs, like car registration or public transport
• Insurance

Debt expenses, for example:

• Personal loan repayments   
• Credit card payments
• Mortgage repayments 

Unexpected expenses, for example:   

• Car repairs and services   
• Medical bills   
• Pet costs   

Do not forget to include little subscription payments to streaming services such as Netflix, Stan, Prime Video, Spotify, and Apple Music if you have them.

Ensure you have recorded all your expenses and look at your bills or bank statements. Include what the expense is for, how much and when you pay it.

If you track your spending, use your list of transactions. You can track your budget in a spreadsheet or journal or keep a mental record of your spending. Finding the plan that works for you will make it easier to maintain and stick to.

Bucketing involves splitting your regular income into accounts (or buckets), with a specific budget for each. It is a helpful way to manage your spending and saving without complicated spreadsheets.

A basic approach is what is known as the 50:30:20 rule:

• Budget 50% of your income for essential living expenses (such as rent, bills and groceries)  
• Budget 30% of your income for lifestyle costs (like dining out and buying clothes) 
• Save 20% of your income into a savings account.  

The first step is to decide how many buckets you need and what they are for. To do this, list all your expenses during a regular spending period (monthly or fortnightly, say), group them into buckets, and set a budget for each bucket. The rest of your income can then be directed into a savings bucket.

The money you have left after expenses are your spending and saving money.

Your spending money is for wants, such as entertainment, eating out and hobbies.

Decide what you want to do with your spending money. This will help you to see where it goes and keep within your spending limit.

If you have a savings goal, you can use your budget to work towards it.

Once you know how much money you have for wants, you can decide how much you would like to save.

Having some savings can create a safety net for unexpected expenses. Even a small amount set aside regularly will make a difference. 

Your budget needs to work for you and your lifestyle, so it is crucial to adjust your budget as things change.

For example, if your expenses start to increase, you may need to reduce your spending or change your savings goal, or you might be able to save more if you get a pay rise or pay off some debt.

Set up your budget, save it online, or use an Excel budget spreadsheet.  

To help make budgeting easier, consider having separate bank accounts. You could have:  

• A transaction accounts for bills and expenses.  

• A transaction accounts for spending.  

• A higher-interest savings account.

You can then automate your budget by creating regular transfers to your savings account on payday. You can also set up direct debits when your bills are due. 

Remember to review and adjust your budget regularly and use digital tools and technology to keep you on top of your money. There might be times that your income changes or you have unexpected expenses or a new savings goal. 

A flexible approach to budgeting can help you keep on track in the long term.  

Having fun is good for our health and well-being, but how can you have fun with the rising cost of living challenges? Our members and supporters shared their thoughts.

“Pack a picnic and have a walk. Use my seniors' card for lunches. There are lots of ways. Whether something is fun or not has as much to do with attitude as to what you choose to do,” said Dina B.

“Go fishing and take a picnic lunch,” said Wendy A.  

“Go for a walk and the occasional coffee!” said Desley G.  

“Invite friends for a game of monopoly/cards etc. Everyone brings a dish!" said Glenda I.

If those suggestions do not tickle your fancy, try: 

1. Going to the library to rent books, DVDs, CDs, audiobooks, magazines and more.  
2. Accessing cheaper accommodation via sites like Airbnb for the adventurous, go camping.
3. Learning a new skill through free apps like Duolingo (languages) or free YouTube videos.
4. If you have a smartphone, listen to podcasts for free via your built-in podcasting app.
5. Eat out for less by downloading apps like Eat Club, which offer restaurant deals.
6. Taking advantage of sales to buy gifts ahead of time.
7. Turn your hobby into a form of income.

Make use of free community exercise classes and workshops. Check your local council website to see what they have coming up.

For further reading: MoneySmart, Commbank and MybudgetAustralia