Setting up a budget is all about having the right S.U.P.P.O.R.T.

“I’ve had a budget before and it doesn’t work”, ‘I haven’t got enough time to be worrying about a budget”. Yes OK we’ve heard it all before, but the point is, you have money so you need a budget. Maybe it’s not worked in the past because you haven’t had the correct S.U.P.P.O.R.T.

Sensible - Make sure you are realistic with your budget and don’t lie. If you spend $200 a week on alcohol, or shoes or both put it in the budget. If you can afford to spend that amount of money we are not going to tell you not to, we just want to make sure you can budget for everything else to fund your hobbies.

Uncomplicated – A saying I have always remembered from my University life when doing anything is ‘KISS’ – Keep It Simple Stupid. Overcomplicating things is not fun or motivating. We all hate not knowing where our money is actually going and whether we have enough funds each month. Keeping it simple will keep you more inclined to stick with it if you can easily spot incomes, outgoings and potential pitfalls.

Period – you aren’t going to see results overnight and you may start to see some improvements over a few weeks. But give it a period of time. Sticking with it and seeing the long term achievement will benefit you in the long run. After a year you can look back and reflect on how you have done with a budget compared to the year before with no budget – I bet you’ll see the difference then. 

Purpose – what do you want to achieve? Set yourself goals, when you can see you are getting closer to reaching your goals you will be more inspired to stay on track. Whether it’s a small goal to keep you motivated along the way or a big goal of where you want to get to, aim and reach for them.

Open – Be open about your budget, write it down, and put pictures up of your goals. Having constant reminders of your budget and goals will help you stick to it when times are getting tough or impulses purchases are tempting you. Keep a picture of your dream house in your wallet and when you go to reach for the credit card you’ll remember your goal and maybe think twice.

Rigidity – make sure there’s room for flexibility in the budget and there’s room to move money and expenses around. Overestimate the expenses and underestimate the income. When you see you are not maxing out your budget it will keep you motivated to stick with it as you can see from the results it is paying off.

Track – Know where you are with your budget. Once it’s been set you need to track how you are going along the way. You need to make sure your review you’re spending so you don’t fall into the trap of bank fees and overspending and only realising when it’s too late.

We can provide you with the correct ‘Support’ at Prudent Cashflow Mentors, call or email us today and we can help and support you through the budgeting process.

How to Survive Budget Busters on Holiday

So I have just spent 10 days in sunny Bali and wanted to share about my unexpected travel costs that I experienced. Working in budgeting I am very good at ensuring that our costs are covered and follow the basic rule of thumb ‘Spend less than you earn’.

So after shopping around for the best deal, my boyfriend and I booked to stay at The Breezes in Seminyak. Our package included bed and breakfast and 24 hour a-la-carte. So we budgeted for $600 spending money, I went to the post office to pick up our currency before departing (ordered online for free so I didn’t experience the commission charge of $8) and we took $500 in Australian dollars as back up. Contingency planning for those unexpected costs.

But, it all begins before you go with the expenses of a holiday, and when we are planning for a holiday do we really account for all of this. I thought I had but the surprising costs still crop up that just weren’t in the budget.

Firstly, having to buy week long fish food rather than just feeding the fish normal pellets each day. This one tablet set us back $21 and fish aren’t exactly the most expensive pet to have. I managed to get a close friend of mine to go to my house and give the fish this one week long food tablet whilst I was away. So to thank her I bought her a small gift totalling $5.

Travel Insurance, so many people avoid buying it but I use to work in travel claims and talk about unexpected costs. If you were to have an accident or need medical assistant whilst abroad that $70 will be the best $70 you’ll ever spend. We insure our cars we insure our houses, make sure you insure yourself, you are the most valuable asset.

Going to and fro the airport in Adelaide, do we really account for the expense to get to the airport in our hometown? Parking and Petrol worked out to be approximately $130. So a close family friend offered to take us for no charge. But to show our appreciation we bought them a gift totalling $35.

On arriving at the airport you’re not allowed to take water through customs. A 5 hour flight to Bali is a long time to go without water, so I had to purchase 2 bottles totalling $6.

So far, and I am not even at the destination, I hadn’t budgeted for any of these costs. These unexpected costs have already set me back $137. It could have been a lot more though if we didn’t have the generosity of friends and family.

One cost I did expect, through research, is the visa upon arrival in Bali, which was supposed to be USD35, however converting into Australian dollars it was a lot more - $50 each so already you are experiencing an unexpected costs because of exchange rates. Be wise with your money when working in foreign currency and don’t make silly mistakes by not understanding how much you are handing over, especially in Bali they will try and rip you off at any point.

After successfully getting to the resort, I confirmed at check in where our meals would be and they advise how breakfast was included. I then got out the paperwork and showed them it said 24 hour a la carte. The hotel then informed us that this was a menu and the a la carte food was available to purchase. Ok, so maybe I should have read the small print because it was probably stated in there somewhere. But already the money we had budgeted is going to have to go a lot further now as we have to plan for meals every day.

The Resort was really beautiful and you could bill purchases to your room. Understandably, there was a limit of USD200 so once we reached the limit I used my budgeting skills and went to the front counter to ask if they could take out the whole lump sum at the end of our trip to avoid extra transaction fees and exchange rate fees. They were happy to do this and took our details down, probably as a precaution just in case we did a runner!

But one thing you can learn from my trip is, try to plan for the unexpected ensure you have a small buffer that you can pay these expenses and not rack up huge fines. Such as going to the reception and being upfront about the transaction fees on your card. We now have the Australian money we took in the beginning to pay the credit card bill off immediately when we get home so we don’t encounter any late fees by having to wait for the next payday.

So you’re on your way home and you can’t possibly experience anymore unexpected costs right? WRONG – oh yes – exit fees, we were flying with Jetstar so surprise surprise we had to pay this at the airport as it wasn’t included in our flight ticket – so yet again another $45 to pay out.

A memorable trip, and some great lessons learnt, a keen traveller you would think I would have this down pact by now but sometimes unexpected costs come up and there’s just no way of anticipating them. Ensuring you have a small buffer and you know where your money goes, gives you that freedom to work around these costs without tarnishing your holiday.