In the last issue of Tukuna, we brought you the first instalment in our Toi Tupu Savings 101 series by providing our top five tips for saving. In this issue, we’ll be looking at how to craft the perfect budget to achieve your lifestyle and saving whāinga (goals).
Creating a budget is a useful tool for you and your whānau to stay on top of your tahua (finances). A budget allows you to visualise and keep track of where your money is coming from and going to on a weekly basis.
Whether it’s saving for a new car, or simply wanting to understand where your hard-earned money is going, it is a good idea to set a budgeting whāinga. Last week we talked about the importance of setting short-term and long-term whāinga. Reminding yourself of these and why you’ve set them will keep the savings momentum going.
Check out sorted.org.nz for a goal setting tool that helps you visualise and craft a plan to achieve them.
The first step to a good budget is to know what your take-home pay is - your income after taxes and other deductions have been paid. This will be the groundwork for your plan of how you want to spend your money.
Getting a grasp on your spending habits can be a daunting task. Luckily, there are multiple apps and websites that are designed to help you out. You could even carry a notebook and jot down exactly where your money is going if that works for you. Rent, bills, coffee, petrol and muffins, everything needs to be logged in order to have an accurate grasp on your tahua.
Check out Spendee, a mobile phone application to track your spending.
Finally, evaluate which expenses are necessary. This requires sorting out which expenses are a priority, and which can be removed to ensure you achieve your whāinga.
Ultimately, the perfect budget strikes a balance between your wants and needs. Finding a realistic plan to achieve those whāinga is the key to success.