Controlling your money

Money. You think you've got enough to see you through, and then it all seems to vanish in the space of a couple of weeks, leaving you with nothing. If this sounds familiar, particularly if you've left home and are living independently, you need to think about budgeting - planning and controlling what you spend, so that you don't keep running out of cash.

Where does it all go?

Try keeping a note of everything you spend for a month. Chances are you'll be splashing the cash on all kinds of stuff you hadn't expected. Everybody's different, but you may find that you are spending more than you can afford on CDs, drinks, phone calls, clubbing or clothes. What's your weak spot?

The big plan

Look at your outgoings, and be realistic. Can you cut down on some of your expenses a bit? Next, make a list of all the things you need to pay for every month. Include your rent, transport, groceries, bills, loan repayments and direct debits, and anything else you can think of. Remember to include a realistic amount for entertainment and socialising. Don't force yourself to live like a hermit.

The added extras

A good tip is to add ten percent to your total expected outgoings. There are always unexpected extras such as birthdays, rent rises, or car repairs to pay for. This should figure most of them into your plan, and smooth over the shock of any nasty financial surprises.

The next step

If the final amount you need to spend in an average month is much more than you have coming in, then sooner or later you will need a debt action plan. It'll involve making some serious cutbacks, while looking at ways to increase your income. On the other hand, if you're lucky enough to have money left over, you can look at all kinds of saving options. Provided you actually stick to your budget, of course.