From apps to spreadsheets, six tips for sorting through your household finances as the cost of living crisis bites

MAKING ENDS MEET IS TOUGHER THAN EVER, as costs soar and energy bills skyrocket.

It’s understandable to feel anxious and worried, but regain control by finding a budgeting technique that works for you.

This week, Harriet Meyer looks at six different budgeting styles so you can choose the one that’s right for you.

1) THE CONSIDERABLE BUDGET

TAKING the time to write down your expenses can make you more careful in your approach to your money.

At the top, write your monthly household income after tax.

Next, write down your main expenses such as mortgage or rent, council tax, gas and electricity, broadband and any debt repayments.

You can then see what’s left to spend each month on other things.

Take a notepad with you to write down what you buy and its cost as you go, to see if you can stick to your budget.

Abigail Yearley of TopCashback says, “As you write down your expenses, you’ll start to consider each purchase and determine if you really need it much more than before. This helps reduce impulse purchases.

2) TOP WITH MONEY

THIS style of budgeting involves taking money out of your bank account each month and “putting” it in envelopes or wallets.

Each will be tagged for particular things, such as groceries, restaurant meals, clothing, and vacations.

You decide which particular spending pots are best for you.

If you have a spending goal in mind, like a birthday party, you can include that and set some money aside.

Many savvy savers swear by this technique, but keep in mind that you will lose savings interest.

The goal is to stop spending in a particular category unless you take money from another envelope.

If you’re not a cash user but think this method would work for you, some banking apps allow you to do something similar by putting your money in “pots”.

3) THE 50-30-20 RULE

THIS simple approach breaks down your spending into needs, wants, and savings.

You set aside 50% for all your needs, so your bills.

Then 30% is spent on your desires, such as hobbies, dining out, and shopping.

Finally, 20% is intended for financial purposes such as debt repayment or savings.

You can establish your own ratios based on your expenses and your situation.

For example, if you have piles of debt, it makes sense to spend more of your budget paying off that and cutting elsewhere.

This can be a good thing if using too many budget categories seems overwhelming and you want a simple plan.

4) JAPANESE KAKEIBO

THIS old technique aims to get you to think carefully about your spending.

You can buy English translations of Kakeibo (pronounced kah-ke-boh) books with advice on how it works from financial experts, or create your own using YouTube guides.

The technique is simple: you divide your expenses into four categories: optional survival (essential expenses) (eg groceries and restaurants), culture (eg movies and books) and unforeseen extras (eg repairs).

Once you’ve recorded all of your expenses, you think about how much you’re spending, what you want to save, and how you can maximize your cash flow.

5) PAY YOURSELF FIRST

Set aside money for your financial goals as soon as you get paid.

This way the money goes straight into your savings for things like future vacations or your retirement, so you don’t have to track expenses and wait until the end of the month to see what you have left.

For example, you can ideally save 10% of your income for retirement, 5% in an emergency fund and 5% in a vacation fund.

You spend the remaining 80% on essentials and enjoying life.

With skyrocketing costs, you can reduce these percentages.

If you’re meeting your savings goals and not sinking into debt, you’re doing well.

6) SPREADSHEETS

These may seem daunting and complicated, but you can create one that works for you.

Use Excel on the computer or one of the downloadable spreadsheets on websites such as moneyhelper.org.uk

Faith Archer, money blogger at Much More With Less, says, “Tapping my expenses into a spreadsheet makes me much more aware of what I’m spending.

“I set up mine with pages for normal expenses, regular bills, and income.

“As a freelancer, the income sheet helps me know if my bills have been paid.

“Writing it all down really forces me to think about where my money went, rather than glossing over individual purchases in larger spending pots.”

“I HAVE PAID DEBTS WITH MONEY”

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PART-TIME supermarket worker Ali Duke uses “cash stuffing” to keep control of her family’s finances.

The mom-of-two saw the budgeting technique last year on TikTok.

Each month, she looks at what’s left of her salary after paying essential bills by direct debit, withdraws the money and places it in filing cabinets and wallets.

One is for Ali’s daily expenses, with wallets divided into sections such as date night, grandson Luke, who is 18 months old, clothes, hobbies, beauty and health.

The other binder is focused on savings, with wallets for outings and events such as Christmas and birthdays, car maintenance, and an emergency fund.

She sets herself £5 savings challenges for goals such as Christmas.

She also saved £500 in her emergency fund.

Ali, 43, who lives with her 39-year-old husband, Mitch, a safety inspector, in Poole, Dorset, says: “I’ve paid off debts such as canapes payments and usually have more money to meet price increases.

‘THE APP IS AN EXCELLENT AND EASY WAY TO BUDGET’

NURSE Andrena Walters, a single mother of three, uses the Hyperjar app to budget and save for her goals.

She allocates her salary each month to different spending “pots” in the app.

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Andrena, 31, from Great Barr, Birmingham, says: ‘I put £250 a month in one for essential bills, £850 for rent in another, and have separate pots for each of my three children, as well as one for specific savings. .”

She is trying to save £200 a month, although it is a struggle now as the cost of everything has skyrocketed.

The app was particularly helpful after Andrena struggled to open a standard bank account due to poor credit.

She says, “I read about it online and found it easy to use.

“You have to move your money around the jars manually so you really think about what you’re spending.”

Her savings goals include a new car and a vacation.

She gets a 4.8% return and adds, “It’s been a fantastic budget.”