How to Develop a Monthly Budget

How to Develop a Monthly Budget

Making a monthly spending plan can help you to assess where your money is going, but it can also help you to budget and see areas where you are spending too much money.

Here is how to develop a monthly budget.


Earnings Total

You will need to start by calculating how much money you expect to make for the month after you have paid your taxes.

Your Monthly Expenses

Create a list that includes all of your regular monthly expenses and include items like eating out, hobbies and minimum payments that go towards debt.

Earnings Minus Monthly Expenses

You will need to subtract your expenses from your earnings. The figure that you have left is the amount that you can expect to have once you have covered all your regular monthly expenses.

Subtract Extra Expenses

Have a look at your plans for the upcoming month and note down any extra expenses that you are likely to have. These extra expenses can include medical bills, repairs, gifts, parties, meals out and so on. These will need to be subtracted from your remaining money.

Create a Cushion

Take a look at the money that you think you will have left over once all anticipated expenses have been covered. Determine if the remaining amount you have left is enough cushion to pay for any unexpected expenses. It is a good rule to allocate 10% towards a cushion.


If the budget comes out on the negative side of things then you will need to look at your monthly expenses again and find areas where you are able to make cuts. Carry on reworking your budget until it works.


If you have any remaining money then it should be put towards paying down debts or to build your savings.

Each month will be different, so it is a good idea to create a spending plan at the start of each month.

Rules to Save Your Money Smartly

Rules to Save Your Money Smartly

Money that is saved is money that is earned. This should be your mantra going forward and even though many see saving as a pain, it has to be done. Saving money doesn’t mean that you cant treat yourself once in a while, you just need to make it part of your lifestyle.


Here are rules to follow to save money smartly.

Review your Home Loan

Take time to look at the interest paid on your home loan. There is so much competition in the market; you should take advantage of this. You need to be sure that your bank is giving you the best deal and if not then compare and negotiate.

Having to Many Cards

Take all of your credit cards out of your wallet and just two that you want to carry on with. The ones that you choose will depend on the interest rate and the rewards.

Limiting your cards will also limit your spending.

Be Organized

Arrange for all your bills and statements to get to you before a pre-decided date every month.

You can then go through these to check them for any mysterious charges. Doing this will also mean that you can recognize your spending habits so that they can be planned or corrected in advance to help you save money.

Plan ATM Visits

You need to have a restriction on the number of ATM visits. This helps as expenses are planned for in advance, as cash needs to be withdrawn. Also many banks have started to charge for ATM withdrawals so by planning in advance you can avoid these costs.

Track your Expenses

You need to keep track of your daily expenses by having a diary or download an app that will do this. Analyzing your expenses regularly you are able to find ways to save on unnecessary expenses.

Sale Season

During the sale season, retail therapy reaches new heights. You are able to save money on some items, so this essentially free money that you got from the discount can be saved.