When you have competing demands for your money it can be hard to make good decisions about what to buy and how to spend.
You may find it helps to put your expenses into Needs, Wants and Savings or Reducing debts.
These are the unavoidable expenses that help to keep you and your loved ones safe, warm and fed. They include your rent, food shopping, utilities, transport, as well as minimum payments on loans and borrowing.
These are all the things you spend money on that are not essential but like to have. They include meals out, going to the cinema, new clothes, gym membership, holidays and concert tickets.
Savings is money that you put aside that might be for emergencies, short-term goals (like a holiday) or longer-term plans (such as retirement). Debt is a sum of money that is owed. Debt repayments include any portion of the debt that you pay back monthly.
When you make decisions that involve spending it‘s a good idea to keep these 3 categories in mind. If you notice that you are spending too much in any single category, it could be an indicator that you need to adjust your spending habits.
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