In the example above, our budgeter reduced their spending on alcohol, leisure and 'other' to keep their outgoings below their income. It involves spending 50% of your income on essentials, 30% on leisure/non-essentials, and putting 20% in savings. Many people find using the 50/30/20 rule helpful. You might want to try using a budgeting 'rule' at this point. Use your average earnings and compulsory spending figures for the past three months to estimate how much disposable income you’ll have in future months, adding in any one-off payments you know are on the way.įrom there, you can set a reasonable budget for your disposable income, along with achievable savings targets. With an accurate picture of your average spending now at your fingertips, it should be easy to draw up a monthly budget you can stick to. Tip: at this point, you may discover you’re regularly spending more than you earn. Our guide to paying off your debts could prove useful in this scenario. If you put money into savings, note down how much money you store away each month too. Note how you’ve spent your disposable income in the previous three months. Next, it's time to add a layer that looks at how you spend your disposable income.Īn accurate review of how you’ve previously spent your disposable income will prevent you from under or over-budgeting in certain areas.
This will show you how much is typically left for ‘non-essential’ spending each month which will form your disposable income. The more accurate your figures are, the more useful your budget will be.Ĭalculate your total expenditure for each of the past three months and subtract this from your monthly earnings. Look at your bank statements, household bills and credit card bills for this task. We’ve included multiple forms of income just to show how that would work, but you may well just need to include your monthly salary here (which would be much easier). Here’s our example of the ‘income’ section of a budget. If your main income arrives more frequently, you may prefer to make a weekly or fortnightly budget. In the example below, our budgeter is paid a monthly salary and they do occasional freelance work on the side.
information on any other income you may have.Ī lot of this 'paperwork' will be virtual these days, so it might be best to open up several tabs and emails on your phone or laptop or print things out if you think it'll help you. details of your savings and pension contributions. a few months' worth of bank statements. It's a good idea to gather all the paperwork you’ll need before getting started, so get hold of: Set aside at least an hour to create your budget. Still having trouble living within your budget? You may want to revisit the Estimate your Resources page to see if there are any other ways you can bring in extra cash, or schedule a Budget & Debt Management appointment with one of our Financial Aid Counsellors.Follow the five tips below if you've never budgeted before, or if you're just looking for a financial fresh start. Be sure to Cash in on $ tips that will help you live for less. If it is not working, it is okay to make adjustments as needed. We know sometimes this is easier said than done. Once you have a plan, it is important to use it. If you are in year one, you can add estimated amounts in the tabs for subsequent years, and consult the final tab, Budget and Debt Overview, where the sheet has been set up to calculate your total educational and living expenses. The Toolkit is set up so that you can enter your expenses by academic year. Depending on how long you will be studying, you can use the Frugal Scholar Toolkitto calculate your Education Expenses, Living Expenses and Resources over the span of your studies. This will help you figure out how much money you will need to finance your entire degree. You are going to be at McGill for more than one year, so you will need an overall budget plan, too. You will find this information on the Budget and Debt Overview tab. As you enter your information over the course of your degree, the Toolkit is designed to add up your total expenses and debt, allowing you to keep track of everything in one place. You can refer to the Budget Pie Guidelines tab to see how your spending is compared to the suggested spending amounts. The sheet is set up so it will add up your entries by category. These tabs allow you to track your expenses and resources on a monthly basis. Open the tab corresponding to your year of enrollment (i.e. This will help you see exactly where your money is going on a monthly basis, and allow you to identify any necessary adjustments. Now that you have thought about the cost of studying at McGill, living in Montreal and have a good idea of what percentage of your income should be set aside for each living expense, you are ready to create a budget! Visit our Budgeting 101 webinar to help get you started.
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