What are your essential expenses?
Your essentials are your day to day expenses you have to pay to keep everything running smoothly.
These can include:
- Petrol, car servicing and registration
- Public transport
- Home maintenance
What are your financial commitments?
Your committed expenses are your fixed expenses, they include bills and debt repayments.
These can include:
- Household expenses such as rent payments, utilities, phone and internet
- Any debts you are committed to paying off including buy now pay later and credit card debt
- Any insurances you may have that you pay directly from your account
- Family expenses such as school fees, day care, child support or baby sitting
Tally up the costs
Once you know what your fixed expenses are, you can set your budget. You can use our Budget Planner to tally up these figures.
Allocate your income
Next you can work out how much you have leftover to allocate towards your rainy day or emergency fund, your one day goals or simply enjoying your day to day.
Some people like to stick to their budget by separating their money into different accounts, each account having a set amount of money to spend on everyday items or bills, for example.
Let’s look at an example of how you might set up your accounts:
- Commitments - such as bills, paying off debt and making rent or mortgage payments
- Essentials - like your groceries, transport and health costs
- Lifestyle – such as buying clothes, movie tickets or eating out
- Saving - for your rainy day or emergency fund or your one day goals
This can be a good way to make sure you only spend the money you have allocated for that purpose.
Keep in mind that with every transaction account you open, you may need to pay more in fees. Although, you won't usually pay fees on savings accounts
Review & tweak
Our research found that if you are organised with your spending, review your finances regularly and actively plan for the future, you are on track to improve your financial wellbeing. Reviewing your spending will help you make any necessary tweaks or factor in expenses you hadn’t thought of.
You can do in the CommBank app with Spend Tracker, which allows you to see how much you spend across various categories including health, utilities, eating out, shopping, groceries and more.