The steps that can help Brits and Dutch to succeed

Follow these steps to ensure your household budget stays up to date and your spending remains under control.

Making a budget can be quite a satisfying process. After drawing one up, you’ll probably feel proud – and a little relieved – that you’ve seized control of your finances.

However, drawing up your budget isn’t the most important task when it comes to managing your money successfully; the key to effective budgeting is sticking to the spending plan you’ve made.

This guide rounds up our experts’ top tips for managing your budget successfully.

A question I’m often asked is:

“How do you create a budget that works?”

No one budget style suits everyone.

In fact, your budget must be completely aligned with your financial and life goals and that is very specific and unique to you and your lifestyle.

However, I wanted to share with you a series of posts that will be dedicated to creating a budget and a few suggestions that you could use for your own.

First of all – Be sure of what your financial ultimate goal is.

Is it to be mortgage free in 5 years?

Is it to be completely financial free (living off the income of your properties/investments etc) within 20 years?

Just want to retire before the age of 65?

Whatever your goal is – Let that be the starting point for any budget you create.


If you’re one of the many people in Britain/Netherlands with more than one bank account, using several alongside one another could help you stay in control of your spending.

Dividing up your income each month and depositing portions into separate accounts – perhaps one for bills and another for spending on yourself – should help you avoid overspending in a single area.

Some people may even choose to open up a second current account specifically for this purpose if they don’t already have a ‘spare’.

Although it’s a useful technique for anyone prone to losing track of how much money they have left for ‘fun’ each month, this ‘piggy banking’ method does mean keeping your eye on several sets of bank statements. You’ll need to be organised and stay on top of the extra paperwork it might generate.

// What is the 80/20 Rule Budget Strategy?

This budget Plan works on the principle that 80% of your wealth will come from 20% of your efforts with capital.

And we mean that literally.

Based on a number of principles, the focus for this budget is that living within your means on 80% of your total household income and saving 20% exclusively to build your wealth, in a mixture of forms, will lead to your financial freedom and security.

I first devised this system a number of years ago, and it is the basis of my own personal family money management.

It shares some similarities as the Dave Ramsey Baby Steps budget, and the 50/30/20 Budget scheme but I feel it allows more freedom whilst still ticking the major goals you need to truly make the capital your ‘worker’ rather than your ‘master’.

the key to managing your budget successfully is to ensure you revisit it – and revise it – on a regular basis. As your personal circumstances change, your budget will need to be amended, too.

Getting a promotion or pay rise should mean you rework your budget. While it may seem like an opportunity to loosen up your purse strings slightly, failing to take account of an income rise in your budget could mean you spend it indiscriminately and don’t truly make the most of it.

Each time there’s a change in your situation that will have an impact on your finances, be sure to look at how your budget can accommodate this.

// Keep all your household outgoings for the lifestyle to 80% of your total budget

Living below your means is the key to long term riches and wealth, as the moment that the scale goes the other way – that is when debt mounts up and you are in a constant cycle of creating more debt for yourself.

With this budget, the goal is to allow yourself to spend up to 80% of your total monthly income on life – whether that is bills, fun, food, petrol, giving back to charity – everything totalling 80% only.

This then frees up funds for investing in your future, such an important area when you actually want to break the pay cheque to pay cheque cycle.

Consider keeping a spending diary

Making a note of all your spending for a few weeks is another way to check that your money really is going where you’d like it to.

It may seem tiresome to write everything down, but if you tend to spend using cash rather than a debit or credit card, you won’t be able to track where your money is going simply from looking at your bank statements and bills.

In addition, many people find that keeping a spending diary tends to concentrate their minds on what they’re spending. Somehow, knowing you’ll need to write it down can act as a disincentive if you’re about to splurge on something you could maybe live without!

// Diversify your 20% Savings in a range of options such as Investing and Cash savings

With this budget style, the final leftover 20% of your budget is for saving for your future and generating passive incomes (income that arrives each month without you working for it).

With this 20%, you would also be ideally looking to generate more capital in the future from it, and that is through pension contributions (for your retirement), personal cash savings you can easily access to for emergencies and investments.

The POWER of Compound Interest and making your capital increase can never be underestimated!

If you don’t already set some of your salaries aside each month to allow it to generate more capital for your future – you are missing out on the greatest trick since the world began.

In the UK, the government have announced plans to set the minimum Pension payment to 4% if you work for an employee, although you can still choose to opt out, the obvious benefit is the more you take from your current pay cheque – the bigger your future ongoing pay cheque will be once you retire or even allow you to retire early.

If your employee offers you the chance to pay into your pension (creating incomes for when you retire) straight from your PRE-TAX pay, snap that up!

Having a percentage of your wage taken before tax actually means you will see less of a dent in your pocket if you had made the investment after you receive your Post-Tax payment each month.

Even better – ask your employee if they make contributions on top of your own from your pay cheque.

Typically employees will usually match your contributions due to the tax breaks they receive – that could mean you put 5% into your pension and they top it up with another 5% on top = 10% total for you completed without you losing that actual 10% from your pay.

Take time to learn about the Stocks and Shares market, so that you can use the power of companies to generate a higher rate of return on your investments.

I particular stick with Index linked Stocks and Shares options, as this uses the power of a range of companies with my capital plus decrease the risk element for me.

With 15% saved in an active investment strategy towards your retirement, you could easily be looking at retiring some 20-25 years after you, first of all, start saving towards it. 


Leave a Reply

Your email address will not be published. Required fields are marked *