Why Do I Need To Develop A Budget?
It's important to get a handle on how much money you will need to live as separated parents. If you're now running two homes it can be expensive and sometimes hard to make ends meet.
Although it may seem scary, knowing exactly what your financial situation is can help you to protect your financial situation and help you to make good decisions regarding short and long term financial arrangements.
What Is A Budget?
A budget is one of the most useful things you can do when you separate from your partner. It can help you make informed decisions around your financial needs and feel in control of your financial situation.
A budget is a list of probable expenses and income for a given time period e.g. 1 month. It can help you to prioritise your spending and manage your money?no matter how much or how little you have.
Where Do I Start?
A good place to start is to go through your bank statements and work out how much you spend on average in a month. Having real numbers, versus estimates will also help you to prepare a more accurate snapshot of what your financial requirements are.
Have a look at our sample budget to see the information you need to gather.
Help! My Expenses Are More Than My Income - What Can I Do?
Unfortunately this is a common scenario for many separated parents. It is difficult going from 2 to 1 income and changes may have to occur to accommodate this.
You have 2 options:
1. Increase your income
If you're currently not working or working part time you may need to look at getting a job or working more hours. If you are working fulltime you can look at getting a higher paid job or find a secondary income.
2. Decrease your expenditure
Take a good look at your expenditure and cut any non-essential spending. Easy areas to look at include eating out, entertainment, alcohol, lottery tickets, dry cleaning, beauty treatments, subscriptions etc.
How Do I Prepare A Budget?
1. Do your homework
Collect all the necessary information about your income and expenditure, use bank and credit card statements, receipts, invoices, pay slips.
2. Decide on a time frame e.g. fortnightly, 1 month etc
Choosing the same time period as your pay can make things a little easier.
3. Put your numbers into a spreadsheet
There are a number of great free online interactive budget tools. TwoHomes has also created a budget worksheet designed specifically for separated parents.
Download the Two Homes Budget Planner
Who Can Help Me Prepare A Budget?
There are a number of organisations throughout Australia that can provide you with free budgeting advice.
To find a financial planner in your area click here.
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