How to write a budget that works and stay on track
December 2025 PayPlan Blog #1
A budget isn’t just a spreadsheet – it’s your money plan.
It helps you make the most of what you earn, stay in control of bills and feel more confident about where your money goes every month.
This guide breaks budgeting into three simple steps:
- Knowing what’s coming in.
- Tracking what’s going out.
- Adjusting your budget to make it work for you.
Step 1: Understand your income
It’s easy to overlook where all your money comes from – wages, pensions, benefits or side income.
List each income source separately to clearly see how much you’ll receive and when.
Check for extra income you might be missing
Helpful tools and resources
- Benefits Calculator – Use our benefits calculator to check what benefits you could be receiving.
- Turn2us – A national charity Turn2us help people access benefits, charitable grants and other forms of support.
- BudgetSmart – Our free tool BudgetSmart helps you explore discounts and the latest money-saving tips.
Step 2: Track your spending
Know where your money really goes
Your budget should include both essential costs (rent, utilities, transport, food) and lifestyle choices (hobbies, subscriptions, treats).
Tracking your spending helps you find small savings that add up.
Did you know? If you live alone, you can usually get a 25% discount on council tax. For example, if your annual bill is £1,686, this could save you around £421 a year.
Struggling with bills?
Many utility providers offer hardship funds or flexible payment plans.
Check BudgetSmart or contact your supplier (like Anglian Water, Severn Trent, or Northumbrian Water) to see what support is available.
Step 3: Build your budget
Start with a full picture of your finances
Gather your recent bank statements, credit card bills or check your banking app to see what’s really coming in and going out.
There’s no single “right” way to budget – the best plan is the one you’ll use.
You can start with this simple format.
Example budget breakdown
Money Coming In
| My Monthly Income (Money Coming In) | Amount (£) |
| Work (personal) | 2,090 |
| Work (partner) | 2,150 |
| Child Benefit | 110 |
| Total Expected In | 4,350 |
Money Going Out
| My Monthly Costs (Money Going Out) | Amount (£) |
| Rent | 900 |
| Council Tax | 180 |
| Gas and Electric | 140 |
| Water | 30 |
| Mobiles | 90 |
| Car Finance | 240 |
| Petrol | 120 |
| Public Transport | 60 |
| Food | 490 |
| Toiletries | 50 |
| Total Expected To Go Out | 2,410 |
What’s Left Over
| My Money Leftover | Amount (£) |
| My Total Money Incoming | 4,350 |
| My Total Money Outgoing | 2,410 |
| Total Money Leftover (Your Total Income – Your Total Outgoings) | 1,940 |
Step 4: Keep it working
Budgets aren’t “set and forget.”
Review yours every few weeks to make sure it still fits your lifestyle, especially if your income or bills change.
Quick budget maintenance tips
- Use BudgetSmart to track changes and find discounts.
- Set a monthly calendar reminder to check your spending.
- If you share finances, review together to stay aligned.
What you can do next
If you are struggling with debts call us on 0207 785 1109. We’re open from 8am – 8pm Monday to Friday and 9am – 3pm on Saturdays.
Alternatively, you can visit our www.payplan.com/bfawu to speak to us via live chat or more information