A guide to managing your money through budgeting.

Budgeting is about managing your money. Setting a budget will help you work out how much money you have available to you, what you need to spend it on and how much you have left to buy things you want. Successful budgeting should allow you to plan your spending and save your money comfortably and within your means, contributing to a healthy and controlled relationship to money.

Preparing a personal budget

The best way to budget is to draw up a budget sheet.

Make a list of how much money you earn or have coming in each month, and another list of what you need to spend it on. This will help you work out how much you can afford to spend each month. You should then set a target spend for each of the things in your list. This should be a reasonable figure, too low and you won't be able to stick to it. 

Include things like the following:

• rent
• bills
• council tax
• mobile phone costs (contract or pay as you go)
• transportation
• food and drink
• toiletries or cosmetics
• any courses, classes, or memberships
• magazines or newspapers
• books, cds, and dvds
• entertainment - cinema, going out with friends, etc
• gifts - birthdays, holidays, and other presents that might come up

Each month you should write down how much you actually spend in each area. Some might be more than you had originally allowed, and some might be less, but hopefully it will balance out.

Look back over your budget every month and see what areas you are overspending in and what needs adjusting. This is a good opportunity to see if you can afford to save any money.

Cut-back calculator

Identify a non-essential item or expense, cut-it out for a day, a week or even a month and see how much you could save!

Budgeting can show you where your spending habits and your expenses aren't matching up, and possibly where savings can be made.

Take a look at the Money Advice Service website for some helpful tools to help you manage your money. 

Managing bank accounts

Managing your money can be difficult, but it is important so that you don’t end up spending money you don’t have! With so many different ways to pay, it’s can be easy to lose track of the amount of money you have in your bank account! It’s really important to keep an eye on both the money you have and what you are spending.

Some suggestions for managing your account:

• Always keep your receipts when you spend money.
• Always get a receipt from the cash machine.
• Make a note of all cheques that you write.
• Keep a record of all the Switch or Delta payments you make.
• Watch your standing orders and direct debits.
• To help plan your spending, write out a weekly, monthly or annual budget plan.
• Use internet banking and regularly check how much money is in your account.

Get a Young Scot Extra Savings Account!

If you're aged 16-25 then start saving and watch your cash-flow grow! Use your Young Scot card and sign-up to the first Scottish-wide credit union for young people, brought to you by Scotwest Credit Union.

Setting up the online Young Scot Extra Savings account is really easy to do. Get started now: www.scotwest.co.uk/Young-Scot 

The savings account allows you to save up for those epic moments – going on holiday with your friends, new clothes or even your first car. Plus be rewarded for saving and earn Young Scot points for setting up an account and saving on a monthly basis.