SLC32-W2 || Real Life Problem Solving Challenge: Budget Planning

I want to be really honest with this post. There was a time I always felt rich whenever I get my salary, but you know what? I was actually rich for three days, the remaining days I would just wonder how my pay went over board. Y'all can relate to this in one point in your Life.

I wasn't broke because I earned small but I was broke because I had zero plans with my pay, I had no budget, I don't track my expenses. I just spend and live the remaining days in regret.

This challenge came in at the right time, making budgets and saving should be a lifestyle and not something we do once. So here is my review and experience with budgeting the mistakes I made and how I was able to control it.

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How I plan my Budget

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Honestly? Last year I just survived, money came in and out and I am always surprised but this year I became more serious on controlling how I spend and plan my Budget. I was moved to make research on Budgets, throughout my search something caught my attention, a rule.

50/30/20

Just a simple rule with great impacts. I had to split my income in this percentage

• 50% goes to my needs (Food, Transport, Bills)
• 30% goes to my wants (Eating out, Flexing, shopping)
• 20% goes to savings

Every Sunday night, after all weekly ups and downs I would settle down and put down my expenses for the new week. This also answers the question on whether I plan my Budget monthly or weekly, my budget is carefully planned monthly but my expenses are accessed everyday and added on a weekly basis.

_{designed with Notion}

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Tools and Methods I use to Track my Expenses

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_{Screenshot from my phone}

Do you want a more controlled access over your expenses and budget?. I bring to you "Money Manager Application". We all spend more time on our phones and it is easy to draft an expense after a payment has been made.

This application gives me access over Budgets, expenses, transfers, incomes and so on. You can keep track of your expenses with this app and also control your spendings.

This mobile app makes budgeting easier, it shows your income, Expense and balance you have left. From the 40k salary I received, I applied my 5030/20 rule. I removed;

• 8k for savings

The app gave the balance after my savings. On each of the days I was able to record my expenses for each day as you can see on the screenshots.

Since I started making use of the Money Manager app, I have crossed out unnecessary Expenses and i am more detailed with my spendings.

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Method 2

Another method I use which is more simpler, I write my daily expenses at the back of my note book which I take to work. During work I do keep off my mobile phones at times and the available material to jot down any expenses is my notebook.

It is very simple and easy to use, I use a very simple method to achieve that. I categorise them to;

Date, category, description and amount.

	A selfie with my Expense tracker List

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I use Notion too to make a full rundown of my Monthly Budget, this keeps me engaged and aware of my spendings.

You might also be wondering why my daily expenses for food is not high, it is because me and 2 of my colleagues are staying in the same apartment, we have foodstuffs and we buy little stuffs for food.

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Unnecessary Expenses that affect my Income

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Making unnecessary expenses on snacks

I am always cautious not to make unnecessary expenses but still, after a week of checking my expense list, I discovered I make Unnecessary Expenses on Snacks. Most times after eating I feel like taking snacks which becomes an extra expense. I worked towards that and I have reduced the amount I spend on Snacks, which has given a positive results on my Expense tracker.

• Making unnecessary expenses on Data
  Since I use data to work, I do make subscriptions and it is categorised under Needs. Why I make Unnecessary Expenses on this is because I did watch a lot of reels and videos online which exhausted my data and brought Unnecessary Expenses.

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How do you save money from your income that will sustain you for future hardships?

_{screenshot from my savings app}

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As I have shown in my Budget rule, I am using the 50/30/20 Rule which shows I have allocated my income to different areas, in the 20% remaining is my savings.

From my income which is a flat 40k naira, I have put aside 20% which is 8k naira as my savings. Now this amount will sustain me incase of unforseen circumstances and hardships. There was a time last year my brother's phone got spoilt without any sign, if he didn't have a saving, he would have gone blank.

From my income I keep 20% for savings

Income	40,000
Savings	8000

A better format I use is to lock it with a savings app, like cowrywise or simply my back app, this accrues interest on the amount. That is a much better way I get motivated to save more to get interests.

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Have you ever created a budget that would improve your financial situation? Show us practically how.

_{Screenshot from my expense tracker}

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Looking at my week 1 expenses, I spent 2600 in 5 days for food. We have everything we need to prepare food, we have ingredients, rice, garri and so on, these extra expenses are just coming.

If I continue at this rate which is roughly N500/day I will spend N15,000 for food this month. This will leave me with N25,000 for other bills with spendings

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Updated Budget to improve my Financial situations

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Category	Old Spending (Estimated)	New Budget	Saved
🍽️ Food	₦15,000	₦10,000	₦5,000
🚌 Transport	₦6,000	₦4,000	₦2,000
🍬 Snacks	₦3,000	₦1,000	₦2,000
🧴 Toiletries	₦2,500	₦1,500	₦1,000
💡 Electricity	₦1,000	₦1,000	₦0
🎯 Wants/Fun	₦15,000	₦12,000	₦2,000
💎 Savings	₦0	₦8,000	+₦8,000
📱 Airtime/Data	₦3,000	₦2000	₦1000
TOTAL	₦45,500	₦39,500	₦22,000

You will observe a lot of things from this updated budget.

• Food : i would have spent a lot on food not minding that I have everything I need to prepare meal for the month, so cutting the spendings will save me 5,000.
• Data: since I spend Monday to Fridays in my workplace, I make use of the free wi-fi which will save a lot from data spendings.
• Savings has also found a place in my Budget.

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What advice would you give to others for great budget planning?

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There's no need to write hundreds of advice, but a key word to get you going.

"Start making Budgets today"

Many people procrastinate a lot, they are willing to start saving/making budgets but they want the right time. And guess what? Some never find that right time.

• Use the 50/30/20 rule: The layout of the rule is very simple and effective, to make a great budget I would advise anyone to start with this.

• Arrange your budgets in categories: to keep a good track of your spendings and expenses make sure you categorise your budget.

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_{I would love to invite @us-andrew, @sampson01 and @pea07 to take part.}

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