I am a spender…not surprising since I’m thirty something with more kids than hands. I don’t need a piece of paper, fancy app or sophisticated software to tell me where my money has disappeared to. In fact, I constantly tell my children that Mum would be rich if it wasn’t for them.

In all honesty I know that my financial equation is a bad one “Money in = Money out”. If I had more money, I would spend more money. When it comes to budgeting, I’m definitely an Ostrich – I bury my head in the sand!

Budget preparation is not exactly high in the entertainment stakes nor is the ongoing entering of information to monitor your progress any more enjoyable. Often time consuming and low on the priority list makes budgeting relatively hard to stick too. But every journey starts with one small step. And that’s when I came across “PERK” created by Robert Pagliarini.

It’s an easy way to see results simply by categorizing everything we spend according to PERK. The process is quick and often you will see potential financial benefits immediately. The first step is to simply list all your spending and mark each with either a P, E, R or K.

P is for Postpone. Include items in this category that can be put off. These can be larger items or a smaller expense such as new car or mobile phone. Postponing gives you more money today to save or invest. The wait also helps against impulse buying and regretful purchases. A cooling off period is never a bad thing when it comes to shopping. If you force yourself to wait for a set number of days, you will find that most of the time the desire has worn off. And if still do you can be confident you won’t be left with regret.

E is for Eliminate. Look for items that you can easily do away with. These days we are inundated with recurring subscriptions. From music to movies, dinner to the gym. There are plenty of services we sign up for that suited out needs at the time but may not serve a great purpose now. It is often a set and forget mentality that these companies rely on. You may need to review past bank transactions, PayPal and credit card statements to refresh your memory because, trust me, they will be hiding in there!

R is for Reduce – Review each of these and ask is it possible to reduce them. Takeaway coffees at the beginning or end of the week rather than each day, reducing grocery bills and store-bought lunches are great place to start.

K is for Keep – These are the must haves and non-negotiables such as Mortgage repayments, Rents, and Insurances.

This process makes you more aware of where your money is going and a great way to identify those areas of spending that can easily be tightened, without the limitations of a traditional budget. And if you do feel more inspired to create a budget you will surprised just how much of the leg work you have already done!

If you have questions on budgeting for Business, or other matters relating to your business, please do not hesitate to contact our office on 1300 620 345.