Why Your Calendar is Essential For Your Budget
15th December 2021
Budgeting monthly is amazing and makes managing your finances so much easier, but unfortunately, it doesn’t always allow you to plan for certain times during the year where you know you’ll spend more than usual (December, we’re looking at you). This is why planning for the year ahead is important, so you can set aside part of your budget for the times that need a little extra, like gift giving times of year.
Grab your calendar or a planner, and we’ll break down what you should focus on when you budget seasonally or yearly in addition to your normal monthly budget, as well as an easy way to do it.
Budget for big seasonal events
For many of us, December is the most expensive month of them all. There’s Christmas, New Year and all the gifts, parties and festivities that come along with it, along with all the preparations and expenses in the lead-up. Plus, there’s all the festive food you can’t get any other time.
In the UK, a typical household spends just over £2,500 in a month. However, as November closes and December begins, our spending habits soar way above the average amount we usually pay out. Specifically, almost £740 more in December, which equates to a 29% monthly spending increase. And alongside the money lost during the festive season, other months can swallow our cash too if we’re not careful with the likes of birthdays, wedding season, summer holidays, and any other excuse for an event to empty our bank accounts.
The easy way to budget for events
Set yourself a yearly budget that includes every event or gift that you know is coming up that year. It doesn’t have to be as detailed as a monthly one, and realistically things can change over the course of a year, but having a general budget will really come in handy for the year ahead.
When planning, divide that estimated total by 12 and turn that into a category that you include in your normal monthly budget. It’s also worth having an individual savings account for seasonal spending that you top up when you can for some extra help - not quite an emergency fund, a seasonal fund.
Plan for your future (even anti-planners)
Everyone is different, and some people prefer to live a more spontaneous life than a structured one. But even free-spirits could use a bit of structure sometimes, especially when it comes to finances, and in fact, it can actually help you to be more impromptu.
Have you got a big trip coming up, or planning on leaving the country for a bit to travel the world? Or are you set on the idea of buying a house in the next few years? People rarely achieve that without a little bit of budgeting, especially when other life events crop up along the way - which they always do.
Everybody's life goals are different, which means everybody's budgets are going to be different, too. In your life calendar, set a date of when you want to achieve something and focus on earning enough money to meet the said goal.
Whether it’s saving up for a deposit on a house or saving up for your wedding day, having an estimated date will enable you to budget how much you’ll need to save per month in order to achieve the goal on time. Of course, you’ll need to take into consideration life in between those goals, including general monthly outgoings and other more spontaneous expenses.
Here’s the thing, having dates and budgets to match not only increases the likelihood of them happening but also allows you to feel good about working towards something. There’s no denying that people have an overwhelming sense of gratification when they meet their personal milestones. Humans also react well to having goals, and it subconsciously makes us happy when we’re working towards them. And if a sense of self-mastery is the only encouragement you need, you’ll be able to work towards everything you want in life.
Save more during less eventful months
Does February tend to be a pretty dry month for your family? No birthdays, no holidays, no events? Just a generic month where you can catch up on sleep and bills? If so, use this time to really crack down on your budgeting, and allow yourself to spend less than you usually would.
Planning ahead and deliberating how much you can afford to save per month is your best bet if you’re looking to say goodbye to debt and hello to financial freedom. Use your calendar wisely to really plan your future - not only will it help you keep on top of your finances, but it will also create a healthy work/life balance that will allow you to live within your means.
Tackle your debt
Whether you already have some debt, or you want to avoid it, having a budgeting calendar will allow you to tackle whatever you owe much quicker than without one. A calendar not only lets you know what events you have coming up and when it’s likely to be an expensive month, but it also allows you to make a strategic plan of when you’ll be able to save more.
For example, we all know Christmas is an expensive month, and we typically spend more than usual, which means December is a no-go for making any savings. By taking this into account and reviewing when you’ll realistically be able to afford to put some money away, you’ll be able to paint a roundabout picture of when you think you’ll be able to pay your debts off.
If you’re ready to experience a life without money worries, it’s worth taking these tips on board and making the most out of your calendar. They’re there for a reason, so put your organised head on and make life 100x easier for yourself!