Building a budget isn’t as difficult as some may believe. It’s sticking to the budget that many people have a problem with. However, limiting your spending can help you visit places such as London without putting you in debt or without you taking out a second mortgage. Your determination to visit this fine city will play a role in your success.
Knowing What You’ll Need
First, you’ll need to know what you’ll need before planning your trip to London. By checking out a guide to UK hotels and figuring out the prices of nearby attractions, you can determine how much you’ll need to save. This will help you set a goal of what you need to achieve.
Living Within Your Means
Before you can begin saving, you’ll need to see where you’re money is going. Keep all of your receipts from every dime you spend and write down all of the categories of things you buy over the course of a month. For example, groceries, utilities, rent or mortgage and phone services may be mandatory, but things such as the movies and visits to the local bar may be leisure expenses. It’s important that you put all of your spending in realistic categories as it will help you devise a working budget.
Once you have your list of things you spend money on, eliminate those items that you don’t necessarily need. For example: Weekly trips to buy video games may be fun, but it’s not a necessity. This will give you a list of things you absolutely need within the household in order to continue living.
Figuring Out a Savings Percentage
Tally up all of the things you need throughout the month. Take the amount of money you make during the same period and divide it by how much you spend. This will give you a percentage of how much you need in order to live. The rest can be dedicated to a savings account. For instance: If you spend $330 and you make $550 in wages, you would divide $330 by $550 – this would result in 60 percent. This means you could save up to 40 percent without putting the home at risk. However, you don’t have to completely cut all of the fun out of your life. Saving half of what’s available may suffice. In this example, 20 percent would be more than plenty while giving you some money for frivolous fun while you save for London.