Step 1 Know what you’ve really got 1 Tips for sticking to your budget Plan for when your income drops If your take-home pay goes up and down, try to plan for when this happens. Your budget will help you to do this. Make a note of your average monthly income figure. When you earn more than this, put the extra money to one side. This will build up a fund to help pay your living costs when your income drops. Use a separate account Some people find it helpful to have a separate account to transfer their extra money into. You can also put your savings and money for one-off payments in a separate account to your normal bills. This keeps it apart from your normal bank account and stops it being swallowed up by day- to-day spending. You can open a savings account with a bank or building society and earn interest on your money. Update your budget if your circumstances change Most people’s circumstances change from time to time and so will their budgets. It is important that your budget continues to give you an accurate picture of your money situation. If it doesn’t, you will find it difficult to keep to. We suggest that you review your budget every six months, or earlier if your income goes up and down or your circumstances change. Which bank or building society to use? If you owe money to a bank or building society and do not pay them, they can take money from an account you have with them to pay the debt. This includes savings accounts. It is called the ‘right of set-off’. To avoid this happening, save money with a bank or building society that you do not owe money to. Make sure that you use a savings account that is best for you. The Money Advice Service can give you advice about different ways of saving (including credit union accounts) and what to look out for. Go to www.moneyadviceservice.org.uk and search for ‘Types of savings’ or call 0800 138 7777. Page 27