If you've looked at your budget and discovered you have a little, or a lot, left over at the end of every month, you can either splash out or put it away. Treating yourself is fun - and sometimes necessary - but the smart money is on saving your surplus for another day, and earning a little interest while you're at it. But it's important to think about where you put your money, to make sure it's working for you.
Money coming in
While you're working out a budget, the most important thing to calculate is how much money you have coming in. This is usually the combined salary of everyone in the house, plus any benefits you might be getting, plus interest on savings and investments. Once you've worked this out, you know what you have to play with.
Money going out
Next comes the tricky bit. Working out what you're spending each month. The big things will be your mortgage or rent, groceries, utilities, childcare, and commuting. But it's important to be realistic about how much you're spending on other little things too - like your daily coffee on the way into work, takeaways and generally having fun.
What's the difference?
Once you have all your figures, it's simply a case of working out the difference between the money coming in and the money going out. If you're spending less than you're earning, brilliant. You can put something away. But if you're spending more than you're earning, you've got a problem. Something has to give or you're in danger of getting into financial trouble. Try our budget planner and see how your finances shape up.
Boost your income
If your outgoings outweigh the money you have coming in, one solution is to try to boost your income. Getting a higher paid or second job, increasing your hours or negotiating a pay rise are all ways to boost your income, but they're easier said than done. You could think about ways to make some extra money in your free time - either from home or online.
Reduce your outgoings
The easiest way to balance the books is to reduce your outgoings. Think about consolidating any debts you have, looking for cheaper utility providers, switching your mortgage, cutting back on life's little luxuries and being more careful with your money. If you're an existing first direct customer, we'd be more than happy to talk to you about your finances (it's kind of our thing) so either give us a call on 03 456 100 188 or send us a message using our secure messaging service and we'll give you a call back.