LUCY Wallington has turned her lifelong passion for budgeting into a business, helping busy families and stretched singles to take charge of their finances.
Lucy, 49, works part-time for a utility bill management company helping people to cut and manage their bills.
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Based in Faversham near Kent with her partner Justin Prior, 60, she also set up her business a year ago after a conversation with a distraught divorcee.
She called up Lucy to ask for help managing her household bills, something she’d never had to do before.
The caller struck a chord with Lucy.
“It’s common for one person in a relationship to hold the budgeting reins and the other to be in the dark so I decided to start blogging to help people to help themselves,” she told The Sun.
A survey carried out last year by The Money and Pensions Service found that one in two adults did not feel confident in managing their money day to day.
Meanwhile, one in three said thinking about their financial situation makes them feel worried.
“People tell me that they feel like their money controls them,” said Lucy. “But that’s because they are not in control of their money.”
Lucy’s approach to budgeting is to take a step back and instead of planning for the month ahead, plan 12 months ahead instead.
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“If you budget month to month, then you’ll be living hand to mouth and that’s what you want to avoid,” said Lucy.
How to get started with the budgeting plan
Getting started is easy, she added.
“Your budget needs to mapped out and written down but how you record it is up to you.”
You can use a notepad or large piece of paper to stick on the wall or record your budget plan in a spreadsheet and save it to your computer.
Lucy offers ready-made budget plans on her website, Budgetingandplanning.co.uk which add up your income and outgoings automatically.
Moneyhelper, the government’s money advice website, also has an online budgeting tool.
Next work out how much regular money you have coming each month and how much is going out to pay for essential bills.
Essential bills include your mortgage, rent, food, utilities, childcare, petrol and train fares.
What you have left is called your disposable income.
Put these three figures: income/essentials/disposable income in each of the 12 months of your plan.
Now it’s time to add in the extra expenses that crop up during different months of the year.
“I add in my three trips a year to the hairdresser to get my colour done and my car MOT which always lands in December,” said Lucy.
Other irregular expenses to add to your planner could be buying school uniforms and equipment in August, birthdays, Christmas presents and your Christmas food shop.
Lucy also suggests finding out when your insurances such as car and home are up for renewal.
Add a note on your planner six weeks before they are up for renewal.
Then you’ll have time to shop around for a new quote and haggle with providers.
You can do the same for your mortgage if your deal expires within the year.
“Add up your ad-hoc expenses for the whole year and divide them by 12,” explained Lucy.
“Every month set this amount aside into a separate savings account.”
Her 12-month approach, said Lucy, gives households stability in their budget instead of leaving them panicked some months because there are a lot more expenses than usual.
“You can also plan in fun events to help you save,” she added.
“Instead of buying new school uniforms or items for the kids like wellies that hardly get used before they grow out of them, arrange swapping events with other mums and dads and add them to your calendar.”
Be prepared to make some cuts too, if the monthly amount you need to save to cover your irregular spending is too difficult to manage.
Agreeing to spend less on Christmas presents by doing a family secret santa is one way to ease the pressure on your budget.
“Like any new skill, it can take time to become an expert budgeter but practice makes perfect,” said Lucy.
Another budgeting expert has revealed the seven switches that could save you thousands of pounds a year.
While another tried the Japanese Kakeibo method and spreadsheets to find the best way to manage your money.
