Budgeting and saving
A guide to what a budget is and how saving money works
What is a personal budget?
A personal budget is a tool to manage your money. You see how much money you have coming in (your income) and how much money you’re spending (your expenses). With a budget, you can allocate how much money you’ll spend on certain things to avoid spending more money than you have coming in.
How do you budget?
- 1. Work out your income
- 2. Break down your spending
- 3. Estimate what you will spend in the future
- 4. Monitor your income and spending
- 5. Find a tool to help you manage this – e.g. a spreadsheet or money app
To manage a budget, some people use a spreadsheet, others a money app. Some people have one bank account for bills and another for non-essential stuff. Some people give themselves limits for what they spend money on, e.g. going out, clothes, etc. You can manage your money in a way that suits you.
Resources for budgeting
These resources will help you understand more about budgeting, including some useful budgeting tools.
- Student budgeting from UCAS
- Barclays Life Skills
- Budget planning tools from Money Saving Expert
- Budget planners from The King’s Trust
Savings
What are savings? How do I save? Where do I put my savings?
What are savings?
Savings are when you put money aside – it’s not for your everyday spending, but usually for a particular, future purpose. For example, you might save money to buy gifts for special occasions, for holidays, for buying a house, or to support future studies.
Where do I put my savings?
Often, people will use a savings account. These accounts are specifically designed for saving money, especially as they’ll have something called an interest rate. This means that you earn extra money on the savings in the account.
Resources about savings
These resources will help you understand more about savings, including how to save and finding a good savings account.
- Banking and savings guidance from Money Saving Expert
- Tips on how to save from MoneyHelper
Image credits
Header image: Ling App
Sarah Agnew
Fiona Murray de Graaff
Christin Hume
Towfiqu Barbhuiya
Andre Taissin
Mathieu Stern