Being in control of our finances is impossible without having an idea of your outgoings. Household budgets are really easy to set up, but they need to work for you If it’s not accurate you are far less likely to stick it.

household budget

Why have a household Budget?

Having a household budget and managing your finances means you have more opportunities to save money and work towards a saving plan. Without knowing your finances it is much easier to spend more than you have and find yourself getting into debt. If you do have debts it’s worth looking into debt consolidation to help you repay these, click here for further information.

How to set a household budget

For a household budget to work you need to be realistic and honest about your spending. Also consider whether you are going to budget for a 5 week month, or a 4 week month. If you prefer to budget for a 4 week month ensure you have a plan for how to cover the shortfall when there is a five week month.

Your budget should consist of the following things:

  • Non Variable Bills. Things like rent, mortgage, council tax, insurances, utility bills, child care, school clubs, phones, TV packages., etc
  • Variable bills. Things that change week to week but are essential such as, food shopping, petrol, prescriptions, lunch money, credit cards and store cards, birthdays etc.
  • Nice to haves. If you have left over money you should consider allocating amounts for savings, spending money, fun money for weekend activities etc.
  • Extras. It is worth considering putting money aside each month to cover Christmas. It is also worth considering a contingency pot for unexpected bills.

How to stick to that household budget…

household budget

Have weekly check ins

Check your bank transactions against your budget one a week. It’s a 10 minute job that can really help you ensure you are sticking to your budget and reign it in if you are not.

Cash or prepaid credit cards

Consider drawing out cash at the start of each week, or put money onto a prepaid credit card to cover your food shop and other variable payments. This way any residual money stays in your bank accounts to ensure you have enough to cover direct debits.

Fun stuff

Where you can allow room in your budget for the fun stuff that you enjoy. You are more likely to stick to your household budget if you don’t feel like you are being deprived and can’t do the things you want to do.

Change pot

Have a change pot at home. For all the times the kids need a pound for school, or you need to grab some milk from the shops. Rather than drawing out £10 from the ATM when you only need a pound, and wasting the other £9, grab it from your change pot. Top up you change pot with any cash you have in your purse and the end of each week.

Have a savings plan / goal

Having a goal to work with gives you an incentive to stick to your budget, whether that is a holiday, a handbag or just reaching a specific amount of cash. It’s also worth transferring your savings to a separate account to you are less likely to spend them.

Review every quarter

Review your budget every quarter to keep on top of any changes to bills etc.


Ensure after creating your budget that you put it somewhere visible as a reminder and easy to grab reference.

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Claire Kirby

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