How to budget and the difference it can make
Do you ever feel like your money slips away before you know it?
You’re not alone. For many of us, the word budget sends us into a mild panic, but in reality, it’s the opposite: a budget can help give you clarity, control, and freedom. It’s about knowing where your money goes, making conscious choices, and putting yourself in the best financial position for the future.
Let’s look at an example
Take James and Emma, a couple in their late 40s with two teenage children. On paper, they were doing well: good jobs, decent income, and even some savings. Yet each month seemed to end with the same stress: “We earn plenty, but why does it feel like nothing’s left?”
They felt stretched despite their success. Most of their money was going on the mortgage, household bills, school costs, meals out, and a steady stream of “little extras” that never seemed much at the time. They wanted to save more for retirement, but there was always something getting in the way.
Let’s start with the basics:
- They listed all of their income and outgoings.
- They split expenses into essentials, non-essentials, and savings.
- Next, they set up a standing order to move money into savings and pensions at the start of the month, rather than hoping something would be left over.
Within six months, James and Emma had cleared a lingering credit card balance and built an emergency fund covering three months of expenses. But perhaps most importantly, they were also able to increase their monthly pension contributions by a modest but consistent amount.
That simple change means they are now on track to retire with greater flexibility — not by dramatically changing their lifestyle, but by being aware of their every day spending and aligning this with their long-term goals.
A pension is a long term investment the fund value may fluctuate and can go down. Your eventual income may depend upon the size of the fund at retirement, future interest rates and tax legislation.
Why Create a Budget?
Think of a budget as your financial sat-nav. Without it, you may reach your destination eventually, but the journey will take longer, cost more, and come with a few wrong turns.
With a budget, you could:
- Reduce stress – less of the unknown, wondering if you can afford the month ahead.
- Spot leaks – small, unnoticed expenses can add up over time.
- Prioritise what matters – whether that’s family holidays, clearing debt, or putting more towards your retirement.
Keep It Simple
A good budget doesn’t have to be complex and time consuming. Start with three simple steps:
- Know what’s coming in
Your salary, business income, side projects – total it up. - Track what’s going out
Break expenses into essentials (mortgage, bills, food) and non-essentials (meals out, subscriptions, impulse buys). - Create balance
Aim to spend less than you earn, while setting aside money for savings, pensions, and future plans.
Even using a simple spreadsheet or a budgeting app can also be helpful.
The Real Challenge: Sticking to It
Starting a budget is straightforward – sticking to it is where most people struggle. Here’s what helps:
- Make it realistic – if your budget feels too restrictive, it won’t last. Build in some room for enjoyment.
- Automate savings – set up direct debits or standing orders to move money into savings or pensions as soon as you’re paid.
- Review regularly – check in monthly. Life can change – your budget should too.
- Celebrate progress – whether that’s paying off a credit card, building an emergency fund, or increasing your pension contributions, acknowledge the wins.
Practical Takeaway
Next payday, spend 30 minutes creating a simple budget. Track your spending for one month and see what surprises you. Like James and Emma, you may be amazed at how quickly confidence grows when you have a plan — and how those small changes could make a big difference to how comfortable your retirement is.
A Final Thought
A budget isn’t about saying “no” – it’s about giving yourself permission to say “yes” to the things that matter most, today and tomorrow. When you have control over your money, you have more freedom, not less.
If you’d like help putting structure around your finances – from day-to-day budgeting through to long-term retirement planning – I’d be delighted to have a conversation.
Call us on 01483 654135 or click here to book directly in the diary
Corcillium Wealth Management is a trading name of 2plan wealth management Ltd which is authorised and regulated by the Financial Conduct Authority. It is entered on the FCA register (www.fca.org.uk ) under reference 461598. Registered office: 2plan wealth management Ltd, 3rd Floor, Bridgewater Place, Water Lane, Leeds, LS11 5BZ. Registered in England and Wales Number: 05998270