MONEY Keeping a lid on your household’s spend

Keeping a lid on your household’s spend


Money matters
Brid Conroy

‘Watch your money’. These were my Mother’s last words, as I boarded that Virgin plane heading for London in 1987. I confess to ignoring most of what she told me when it came to managing my finances, until much later. When circumstances demanded it, her words and example finally sunk in, along with some help from my accountancy training.
Now, it seems we are all being forced back to those age-old principles of managing the household’s money. It really is a great opportunity to look at all aspects of your finances and form a plan for your future. This is how you can do it.
Start with calculating how much your current lifestyle is costing you every month compared to what you earn. It’s very easy, you can go to www.itsyourmoney.ie and click on ‘Work out my budget’. It leaves no room for delusion. Every item you might possibly spend your money on is listed here. In preparation, ask for a receipt for everything you buy for the next month. My husband hates this, but it works.
At the end of the month, gather all the receipts for cash items, laser and visa take from bank statements and start entering into the website, by category, all your expenditure for the month. Include all your direct debits and cheque items as well, but it may be better to take an average for the utility bills.
Next enter your income from every source. For self-employed people, take an average of your lodgements for the last four months, less vat if applicable. Click calculate at the end and a summary will be produced showing how your income matches to your expenses.
How does it look overall? Do your expenses match or exceed your income? Whatever the outcome, it is essential you now go through each item line by line. What are you spending too much on? Can you negotiate better deals? I called my credit card company and got a 0 per cent interest rate for six months. I used the insurance checklist on itsyourmoney.ie and reduced my house insurance by a third.
And what about those day-to-day items? I conducted an experiment with a friend, who spends on average €250 a week in Tescos. We set out with full bellies (a recent survey claimed a reduction in spending when you’re not hungry), left the laser card at home and took €200 in cash to spend. Everything got scrutinised. I was in my element. Buy nothing at hand level – you’ve got to look for the bargains.
Ignore those pesky special offers. Do you really need three packets of carbonara for the week? All in all, the bill was reduced to €158. Imagine what you could do with that extra cash over a year? 
So, set yourself a target. Keep it as simple as possible, maybe choose two areas of spending you want to concentrate on.
The same applies to your income. Find two things you could do to earn some extra money. It could be as easy as claiming some extra tax credits, selling something on e-bay, using an old forgotten skill or a hobby you’re passionate about. Lastly, redo your budget with your new targets. Now you have a plan you’re committed to.
After saying all that, it really doesn’t matter how you do it, but spending a little time to review your finances and write down a plan, means you are in control. Remember the saying ‘whatever you give attention to, grows’. Focus on improving your finances and it will happen. You’ll be amazed how simple it is.