Analysing Your Monthly Budget Report
In a previous article we talked you through building your custom spreadsheet and when and how to fill it in with simple spreadsheet commands and formatting. In this blog we are going to look at some of the more technical aspects of your monthly budget reports.
Therefore we’re going to introduce you to using averages to summarise and show your yearly expenses on a graph, using physical cash out of a pre-set amount for the month in order to stay in your budget, as well as setting goals of how much to spend and save every month.
Using Your Spreadsheet
As long as you fill in your spreadsheet at regular occasions, taking care to create a new sheet for every month, you should find yourself with information on your spending habits over a long time. This is fairly useful if you want to have a visual record of your progress or how much you’re saving, or if you just want to know if you’ve got into a trend of gradually spending more or less on something.
As well as giving you the opportunity to make graphs and play with your personal finance figures, the most important thing about having historical data is being able to use it to plan ahead and analyse trends in how you’re spending money in a way that’s easy for you to understand.
Building a graph is fairly simple – using a spreadsheet program, you can construct a small table of the months over which your data was taken, and the amount that you spent. Then, it’s as easy as pressing insert>graph and the program should generate one for you.
This example chart with mocked-up figures is really easy to create, and shows an upward trend in expenditure on a particular thing over the year. It’s also just as easy to include data from a couple of years on the same chart to see the difference between how much you spent on the same thing last year compared to this year.
A chart like this provides a clear, visual indication of your spending habits from year 1 in the blue to year 2 in the red – this chart shows a general upward trend in expenditure, which could be used as evidence to change your habits later on or cut down on spending on a certain thing and review in a few months.
Using Your Budget Report to Save Money
The most important aspect of historical data is being able to predict how much you’ll need to spend, month on month, on certain things. This lets you prepare for outgoings when you get your paycheck – you can stock the account that pays the bills with adequate money based on your charts or data, and you can take out the money you need for fuel, food, and other expenses in cash.
Once you’re able to judge the amounts of money you need and how to cut up a regular paycheck, it’s a lot easier to start cutting down on expenses or simply just spend less of the money you have so you can hold onto a little or save more.
For example, if you’ve taken out cash money for a week’s worth of shopping and find you’ve spent around ten pounds less, you get to hold onto that money. Anything you save has a knock on effect of saving again and again as long as you hold onto it.
With your graphs, your figures and some good budget planning, you should be equipped to have a better handle on your personal finances, and in turn better peace of mind. All of these things combined can help you feel confident, financially secure, and give you realistic goals of how much to save every month.
Each small bit of effort you make with personal finance counts down the line, so we hope you take every opportunity you can and this guide has helped you get inspired to save money for something you really need or just to feel more happy in the knowledge things are under control.