Being smart with your money is not just about where you put it. It’s also about how you manage it. And that means good budget planning to help meet the “expected”, like the mortgage, and the “not so expected”, like that root canal no one saw coming. Here’s a few budgeting tips to help get you started.

Step 1  List your expenses

The first thing you need to do is work out where your money is going. Start by drawing up a list of everything you spend for a month. There are the “regulars” like mortgage, rent, car loan, credit card repayments, train to work, mobile and internet and insurance costs. And the “irregulars” that you don’t always keep bills for, like dinners out, a new dress, a friend’s birthday lunch, the movies or a haircut. And don’t forget to allow for the odd surprise like that root canal treatment. At this point your bank and credit card statements and bigger bills will be a great help. And our budget planner calculator will also make life a bit easier.

Step 2  List your income

Whether you’re paid in predictable regular payments or sporadically, this bit should be a lot easier. Simply highlight deposits on your bank statement like wages, welfare benefits, child support and investment income from share dividends or rent, and then total them up.

Step 3  Do the maths

Now that’s done, it’s time to subtract your expenses from income. If you ended up with more going out than coming in, i.e. a deficit, then it’s decision time. What can you live without? Here are a few ideas – consider eating in on date night, rent a DVD instead of going to the movies, take your own lunch to work or put a cap on home delivery pizzas. And there’s always the option of working more overtime, doing extra shifts or even taking a second job after work or on the weekend.

Step 4  The next steps

Now the work can begin! Is your budget going to be weekly, bi-weekly or monthly? (Fortnightly is best for students, as that’s the cycle for Centrelink payments like Austudy.) Do you have a savings target? If so, work out how much you can afford to save monthly or weekly to reach it then treat it as a regular expense.

NAB budget software

Here are some links to help with your personal budget planning:

This budget planner will help you to save for your goals.

The big day is arriving and to help we’ve put together a wedding budget planner so things run smoothly.

Want some financial or budgeting advice? Find out how a NAB financial planner can help.