The Fourth Budget Of The Year In Review

The start of a new month signals it’s time to share the fourth budget of the year in review, a new series that I started at the beginning of the year as a way to share how I budget and manage my money. The fourth month of the year was the most fun one even though I blew my budget in most areas. What is interesting is that even though I have been budgeting for so many years, there are times when even I blow the budget but what’s different between now and when I started budgeting is that, now even when I blow the budget I still have extra money in my account to cover those costs instead of going into debt.

At the start of the new month, I sit down and review my previous month budget to see how I did and also track my habits to see if I am consistently blowing my budget on unnecessary things or maybe an expenses has become repetitive which means it needs to be added as a new category to my budget tracker. I follow a ‘zero-based’ budget approach which simply means that my income minus my expenses = zero, this doesn’t mean I spend every single penny but rather that every single penny does have a job to do in my budget whether its going to savings or paying off the mortgage. If you are new to budgeting and need tips and guidance, I hope the fourth budget of the year in review will be beneficial to you as you start your budget journey.

Disclaimer: I am not a financial advisor, all opinions shared are my own.

The Fourth Budget Of The Year In Review

At the beginning of April when I shared my April Budget with me video, I talked about all the expenses that I was expecting throughout the month of April. One thing I had planned for but still ended up blowing my budget on is my brother’s birthday, I had allocated only £50 in my sinking funds for birthdays but his present was too expensive and I instead spent £260 (a who £210 more than planned). This expected unexpected income was swallowed up nicely in my budget because I have enough money saved in various savings accounts that I could tap into and use.

Whenever you are planning a budget, it is important to ensure that you budget for more than you normally spend at least that way you don’t find yourself out of pocket. I am both a ‘saver’ and a ‘spender’ – yes I am a walking oxymoron but such is life and because I have the mindset to always save more than I spend, when I need to make unexpected bigger purchases I can still afford to do that because I have been spending for a while now. For the fourth budget of the year in review as I have mentioned I below the budget and below I show a snippet of what my planned and actually spending ended up being.

Budgeting is not meant to be restrictive nor rigid and over the years I have found that having as much flexibility as possible truly helps me with my budgeting. When your budget is restrictive and you are constantly blowing it, it can become a hindrance which could lead to you becoming unmotivated to budget again. This is why when I blow my budget on my category I make it up by spending less in another category and if I can’t then I just adjust my budget for the next month. Get into the habit of adjusting your budget as need be but also track habits that cause you to overspend in some areas.

Other Money Posts you May Have Missed

• How to start planning for retirement – it is never too early to start planning for retirement, if you are young you are at an advantage, take it.
• How to start investing as a beginner in the UK – similar to the above, the earlier you start investing the better for your future, I started investing in my 20s and I earned enough money to buy houses.
• Why you need both an EF and SF – Although both Emergency Funds and Sinking Funds are cut from the same cloth, they have different purposes and I explain in detail in the post.
• How to set-up sinking funds (SF) – Sinking Funds are the best way to save up for items that come around every year like Christmas and birthdays
• The Best books I have read this month (Book roundup) – I read some great financial books which I highly recommend, my current read is ‘Money – know more, make more, give more by Rob Moore‘.
• The richest man in Babylon (Book Review) – this book was written in the 20s but the message is still applicable today and I highly recommend it.
• How to fix your finances (Book Review) – Another great book especially for women of colour and women in general starting to get a handle on their finances
• How to build and Emergency Fund (EF) – everyone needs to and should have an emergency fund and I recommend 3-6 months of expenses.
• Is paying your mortgage off early a good idea? – I plan to repay my mortgage off early at least in the next 10-15 years time and in the post I explored some reasons why.
• The total money makeover by Dave Ramsey (Book Review) – this is an incredible book that I totally recommend, its brutally honest but exactly what you need to get on the straight and narrow path.

And there you have it, the fourth budget of the year in review, I am glad that I was able to save 51% of my total income in the month of April and this is even with blowing my budget in my variable expenses. But as I said, budgets are a guide on how to spend your money, they are not meant to be rigid and stop you from enjoying your life but rather allow you to enjoy it better. You can check out how I budget my money and the April budget planning and close out is in the playlist below.