Hi Phoebe, thank you for your email and congratulations on competing your degree and also being able to go straight into full time work that is a fantastic achievement. Based on the information that you have provided you receive a nett income of $44,200 per annum and your fixed expenses are $5,980. Based on this you have a surplus of 38,220 per annum.
When considering establishing a budget there is no one way that will work for everyone and it will take time to create the habit to maintain your spending. It is suggested that you consider breaking down your spending into three components: expenses, spending and saving. Examples of expenses include rent, utilities, phone, internet, transport, groceries, credit card debt etc, for spending areas include entertainment, dinners out, gym memberships, coffee etc. Savings can be for a holiday, car, deposit on a house etc. If you do not have a savings goal that you are aiming towards then a good starting point is to contribute 10% of your income in your case $170 per fortnight into ‘savings’.
With regards to expenses you may need to look at your expenses over the year and then break them down into fortnight amounts. For example gas may be $150 per quarter, $600 per year. Broken down into fortnights this is $23. You can then maintain this amount in ‘expenses’ and have the funds available when the bill is due. As you have a credit card debt clearing this debt needs to be your priority. It is suggested that you direct a large portion of your income towards clearing this debt. Once this is cleared it is recommended that any new transactions be paid monthly to reduce paying interest on the credit card.
With the savings component if you have large savings goals then break them down into small amounts. For example if you have a holiday that will cost $2,000 and it is in 12 months’ time. Over 12 months you will have 26 pay periods and therefore $2,000 divided by 26 is $77 per fortnight. If you put this money away each fortnight it is not going to have a significant impact on cash flow and you will not need to find the money at the time of the trip it will already be available.
The moneysmart.gov.au website has some good budget planning tips and links to the trackmyspend apps. The main point is to get started and work out the best budgeting method for you.
Good luck with your budgeting
Hi Phoebe, thank you for your email and congratulations on competing your degree and also being able to go straight into full time work that is a fantastic achievement. Based on the information that you have provided you receive a nett income of $44,200 per annum and your fixed expenses are $5,980. Based on this you have a surplus of 38,220 per annum.
When considering establishing a budget there is no one way that will work for everyone and it will take time to create the habit to maintain your spending. It is suggested that you consider breaking down your spending into three components: expenses, spending and saving. Examples of expenses include rent, utilities, phone, internet, transport, groceries, credit card debt etc, for spending areas include entertainment, dinners out, gym memberships, coffee etc. Savings can be for a holiday, car, deposit on a house etc. If you do not have a savings goal that you are aiming towards then a good starting point is to contribute 10% of your income in your case $170 per fortnight into ‘savings’. With regards to expenses you may need to look at your expenses over the year and then break them down into fortnight amounts. For example gas may be $150 per quarter, $600 per year. Broken down into fortnights this is $23. You can then maintain this amount in ‘expenses’ and have the funds available when the bill is due. As you have a credit card debt clearing this debt needs to be your priority. It is suggested that you direct a large portion of your income towards clearing this debt. Once this is cleared it is recommended that any new transactions be paid monthly to reduce paying interest on the credit card.
With the savings component if you have large savings goals then break them down into small amounts. For example if you have a holiday that will cost $2,000 and it is in 12 months’ time. Over 12 months you will have 26 pay periods and therefore $2,000 divided by 26 is $77 per fortnight. If you put this money away each fortnight it is not going to have a significant impact on cash flow and you will not need to find the money at the time of the trip it will already be available.
The moneysmart.gov.au website has some good budget planning tips and links to the trackmyspend apps. The main point is to get started and work out the best budgeting method for you.
Good luck with your budgeting
