Planning a budget

Managing your money can be difficult, particularly if you are living independently. The amount you spend adds up when you consider that you might have to pay for rent, gas, electricity, water, the telephone, council tax, TV licence, transport, insurance, cleaning materials, toiletries, clothes, entertainment, food, birthday presents, etc. Make sure you check out exactly what rent.

The best way to manage your money is to budget.

Work out how much money you have coming in (income) and how much money you have to pay out (expenditure).

Example budget checklist

Income	Amount (£)	Expenditure	Amount (£)
wage		rent
benefit		gas
		electric
Total	£		£

What does this leave you? Always allow a little extra, if you can, for emergencies.

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Do's and Don'ts

To help you budget here are some dos and don'ts

Do:

• Look at your income and work out a budget for spending - and saving
• Keep a record of what and where you spend

• Have a list of priority spending - make a difference between needs and wants.

• Take advantage of any free banking facilities that are available for young people
• Reply to all letters from your bank, building society, credit companies, etc. and keep a copy of all correspondence.
• Know who to go to for advice and help if you have a money problem.

• Overspend as soon as you get some money - it needs to last you until next pay day
• Buy non-essentials if you are struggling to pay for essentials.
• Ignore the signs that your spending is getting out of control.
• Guess at what you are spending - make a list
• Be afraid to talk to someone and seek advice if you are having problems
• Make promises to pay for something when you know that you can't.
• Exceed your overdraft limit without asking the bank first. Unauthorised overdraft rates are very high when compared with what is offered if you stick within agreed limits.

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Getting into Debt

Debt becomes a problem if your spending (outgoings) is consistently higher than your income and you can't pay your bills or keep up the repayments on loans.

• Take control - don't ignore the problem and hope it will go away. It won't.
• Make contact - work out who you owe money to and write to them explaining your financial situation.
• Get some help - discuss your problems with your bank manager if you have one or with someone who can give you good advice (see below).

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Help and advice

General
Credit Action 01223 324034
Money Advice Association 0171 236 3566
National Association of Citizens Advice Bureaux 0171 833 2181
Department of Social Security (freephone helpline) 0800 666555

Students
Educational Grants Advisory Service 0171 254 6251
Student Loans Company 0345 300 900
Student Loans Company (freephone helpline) 0800 405010

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