If you have a new baby, the idea of budgeting is often
buried under what can feel like a tidal wave of necessities for your new
arrival. "How can something so small need so much stuff?" is the heartfelt
cry of many new parents.
Naturally, this is just the time when finances are stretched
to the limit. The combination of a reduced income and lots of extra expenditure
all adds up to a worrying money picture. Creating a budget implies sacrificing
things that you enjoy, living on beans and never leaving the house.
However, cutting back doesn't have to be painful. Here are
ten tips to cut the costs of family life without sacrificing your quality
of life.
The first step to reducing your outgoings is probably the
hardest! Make yourself a big pot of tea, break out the chocolate biscuits
and gather together all the paperwork and receipts you can find. This
could take some time, so you might as well settle down for the evening.
Go through the receipts and statements and write down all your outgoings.
A spending diary can help you keep track of those little costs such as
newspapers and the occasional coffee, which can quickly add up.
Regular outgoings
These can include your mortgage or rent, council tax, internet
connection, mobile phone bill, TV licence, and an average of your heating
and electricity costs.
Irregular costs
These are the difficult ones to pin down and include birthday
presents, haircuts, clothes, dentist fees, school trips and holidays among
many others.
Being organised is the secret to remaining in control of
your finances. Unexpected bills, spontaneous purchases, and popping to
the shops for milk and coming back with "some extras" can tip you into
the red. Paying regular bills by direct debit creates less work for you,
and will save you money.
Another weapon in your arsenal is having instant access
to your account details. You can use telephone or internet banking, but
get into the habit of checking your account at least once a week.
This enables you to keep an eye on your outgoings and you
can look out for any odd transactions which could indicate you have been
a victim of fraud.
 This
is the difficult one. It is virtually impossible to get your budget right
the first time around, so just make an educated guess the first month.
Try to be realistic and over-estimate if you are unsure
to avoid any nasty surprises.
As long as your total outgoings are less than your income,
you should be on target.Keep your spending diary going, and try todevelop
an obsession with online banking.
Sometimes using a cash-only system works, as handing over
a crisp £20 note feels more real than plastic.
Budgeting isn't just about saving money - it can also work
the other way around. Check the website www.entitledto.com
to find out if your family is eligible for any additional benefits.
For working families, the cost of childcare can be cripplingly high.
There is a little known government Childcare Voucher scheme
which lets you pay for the first £55 per week of childcare costs out of
your pre-tax income. Your employer has to apply to join the scheme, but
it's worth having a chat to your boss about.
You can find out more about the vouchers at www.moneysavingexpert.com
The concept of rewarding customer loyalty is virtually non
existent in 2007. New customers get offered the biggest discounts and
special offers, so hunt around for the best deal and take your money there
instead.
Electricity and power providers can give the biggest savings
- try www.uswitch.co.uk
to find out how much you could save. The prices for phone packages, broadband
internet and cable TV have all fallen dramatically in the last two years.
If you are concerned about the difficulties of doing a
"ditch and switch", simply phone your provider and threaten to leave unless
you are offered a better deal. Mobile and satellite providers are normally
the most flexible. It's certainly worth a try.
Food is one of the major costs for any family. Again, organisation
is the key to keeping this cost down. Planning ahead and sticking firmly
to your list will help you resist the temptation of those "little extras".
 Milk
and bread both freeze well, so buy a couple extra to keep you going until
the next shop. Many supermarkets will offer good incentives such as discounted
petrol, vouchers or free home delivery. Online shopping is another good
way to become more organised.
Virtually all the major supermarkets offer incentives for
your first shop, and free delivery if you spend over a certain amount
or choose a less popular delivery time. You can also access all the in-store
promotions such as BOGOFs (Buy one get one free) and special offers.
Use these to stock up on non perishable essentials such
as tinned tomatoes, tuna, toilet rolls and shampoo.
Tesco Clubcard points are not brilliant if you redeem them
against your shopping, but log in to the Tesco website and you'll get
four times the value of your points in Tesco Deals. These points can be
put towards virtually anything including days out, magazine subscriptions,
furniture and toys.
Everyone has an attic or garage full of old toys, clothes,
roller-blades, videos, books and other clutter. Sell it, throw it away
or give it to charity. You'll feel a lot better and your budget might
look healthier too. Take advantage of the regular 10p listing days on
Ebay to sell things you thought no-one in their right mind would ever
buy. It's almost guaranteed that there will be someone.
Everyone works hard for their money, so why give more of
it away than necessary?
Retailers compete for your business, and frequently offer
fantastic cashback or discounted rates when you buy such things as insurance,
books etc.
Browse through cashback websites such as www.quidco.com
, www.pigsback.com
and www.rpoints.com
who all regularly offer up to 30% cashback for major stores such as HMV,
Marks and Spencer, Comet, Tesco and PC World.
Meal planning isn't just for war time rationing; it could
reduce your waste and save you time and money. Don't worry, you don't
have to start baking your bread at 4.30am and digging out recipes for
sponge pudding.
Try starting small by noting what you eat every evening
for a fortnight.
Pick five of your favourite meals and buy all the ingredients
you need in one trip to the supermarket. Stick a list to the front of
the fridge so everyone knows what's for dinner.
Relax! Budgeting is not easy, and it doesn't have to be
right first time.
Be prepared to adjust the budget and don't panic if you
don't stick to it every single day. It's a target, not a law. Just try
taking one small step at a time, and before you know it, you'll be completely
in control of your family finances.
by Olwen Jones
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