Man counting money change for end of month summary

Keeping Your Budget on Track with the End of Month Summary

In General Budgeting, Grandma's Jars by Phil McGilvrayLeave a Comment

Just about every client will ask me at some point – what do other people spend on (fill in the blank)? We are all curious about what other people spend on things. We like to be able to benchmark ourselves. Over the next few months I thought I would share with you some real life budgets, along with my thoughts as a financial coach.

To protect their privacy of the clients used in this real life budget, we will refer to their names as Fred and Wilma.

List of Expenses

Background Summary

  • Fred (32) is a Public Servant
  • Wilma (32) is the promotions officer in her parents business
  • They have 4 beautiful children aged 5, 4, 3 and 2
  • Between them they earn approx. $163,000 before tax ($130,000 after tax)


Fred and Wilma’s story is very typical of the financial struggles many people young people are facing today.

They had never thought twice about using debt to buy things, their cars, furniture, and white goods were all purchased using debt. Thanks to their credit cards they always seemed to cover the bills and buy the things they wanted.

That was until their expenses started to overrun their income. Their debt repayments accounted for over half their income and there had been days recently where they had struggled to find the money to buy groceries.

They were referred to me by work colleagues who had been in an almost identical position just 6 months earlier and done an amazing job of turning their finances around.


  1. To get out of the Pay Cheque to Pay Cheque cycle
  2. To catch up on all their bills
  3. To have some savings in the bank
  4. To knock off their $115,000 in personal debt as quickly as possible
  5. To never be in this situation again
  6. To proactively teach their own children how to manage money


Their Budget

Here is the budget they initially presented me with, the comments I made and what their budget look like after some initial changes.



Source of Income Income ($) Income per Calendar month
Fred’s Salary $2,220 / fortnight $4,810
Wilma’s Salary $2,391 / fortnight $5,180
 TOTAL  $9,990

List of Expenses



Expenses Monthly




My Comments / Feed back
Everyday ($)  ($)
Groceries 1,265 800 $1,265 is at the high end of average for Groceries. At ages 5, 4, 3 and 2 the kids are not yet eating a lot. By planning meals and shopping to that plan once a week (not every night) they could realistically pull this back to $800/month.
Petrol 260 100 This is below average but Wilma’s Petrol is covered through the family business.
Take Away 100 300 Fred and Wilma were absolutely shocked at how much they were spending on things like coffees, bought lunches and McDonalds for the kids while at the shops etc. All those little bits really added up. We agreed that $300 was an amount they thought was reasonable for this category of expenses.
Cash/Pocket Money 200
Coffee out/bought lunches 140
Subtotal $1,965 $1,200
Utilities ($) ($)
Gas 80 80 These are monthly figures. However, Fred and Wilma did actually have their bills set up as ‘even pay’ fortnightly deductions, set to come out the day after they got paid just to make sure they didn’t get behind. I like direct debit even pay, but the downside of this is that it can entrench the pay cheque to pay cheque mentality. This is one of the reason I recommended we budget and pay bills monthly to break that cycle.
Electricity 292.50 292.50
Heating 42 42
Water 165 165
Rates 152 152
Subtotal $731.50 $731.50
Communication ($)  ($)
Mobile Phones 160 160 Fred and Wilma need to give serious consideration to how much money they are ‘surfing & texting’ away due to habits. The killer here for Fred and Wilma is that they have plans with handset repayments. When their plan finishes they will keep their old handsets and go onto a much cheaper plan.
Internet/Telephone 130 130
Subtotal $290 $290
Car ($)  ($)
Registration (two cars) 171 171
The amount allowed for maintenance is very unrealistic, especially when you include replacement tyres every 2-3 years. A rough rules of thumb for maintenance is:

  • Cars <4 years = 40% of Petrol cost
  • Cars 4 to 8 years = 60% of Petrol cost
  • Cars 8 years + = 80% of fuel cost


Maintenance (inc tyres) 70 175
Insurance 105 105
Licence 5 5
Subtotal $351 $466
Grooming ($)  ($)  
Clothes 100 80 This is really tough for a growing family. They do benefit from hand me downs but $285 is reasonable, $345 is high end of average but by no means extravagant.
Cosmetics 50 30
Hairdresser/Beauty 95 95
Shoes 100 80
Subtotal $345 $285
Gifts ($)
Christmas 175 81
Fred and Wilma completed the gifts list worksheet and were shocked at how much they spend on gifts. Most western nations waste huge amounts on gifts. Having a gifts list helps you focus on who you want to buy for and how much is reasonable to spend.

They have allocated $100 per child for Christmas and $100 per child for Birthdays which is about average.

Birthday 160 70
Others 70 10
Subtotal $405 $161  
Health ($)  ($)
Doctors 10  10
Fred and Wilma are part of a medical Co-op that covers doctors and dentist under medicare. This isn’t a bad option of you don’t care which doctor/dentist you see.

Health insurance is on the lower end of average.

They hadn’t allowed for allied health or pharmacy – we added chemist as they do have regular trips to the chemist with 4 kids.

Optical  –  –
Dentist  –  –
Physio/Chiro/Massage  –
Health insurance 220 220
Chemist 50
Subtotal $230 $290
Kids ($)  ($)
Sport 120 120 This is a category that Fred and Wilma will need to keep an eye on. With 4 kids so close together in age they need to make sure that what they are doing for one child now, what they will be able to afford for 4 over the next few years. Multiply these costs by 4 and all of a sudden you have the equivalent of a mortgage repayment.
School Fees 260 260
School Uniforms 33 33
School Trips/Excursions 20
Subtotal $413 $433
Sports/Hobbies ($)  ($)
Gym Membership 54 54 This is a very reasonable price for a Gym membership. However, it is expensive if you no longer go! Don’t waste money on memberships you no longer use, just in case you might go back one day!
Subtotal $54 $54
Professional Fees ($)  ($)
Bank Fees 36 36
This is the annual package fee for mortgage, bank accounts etc. Around $300- $400 is a typical annual package fee.

No accountants fee as they typically do their own taxes.

Subtotal $36 $36
Holidays ($)  ($)
Annual 250 250 When it comes to holidays, the only right amount is the amount you can afford. Fred and Wilma are already committed to two weeks at a beach house with family. Travelling with kids is hard work so at this point in life $150-$250 is about right for holidays.
Weekends & Extras 0 0
Subtotal $367 $217
Household ($)  ($)
Gardening Items 0 0
Having nothing for this category is completely unrealistic. House and gardens cost money whether we like it or not. Given the circumstances we have left it at $0 for now.

 A typical budget for ‘household’ is approx. $200/month.

Computer Supplies 0 0
House Maintenance 0 0
Subtotal $0 $0
Insurance ($)  ($)
Personal Insurances 0 0 Personal Insurances – No personal insurances is a concern. They do have some life and permanent disability insurances through super but not enough given their debts and the ages of their kids.

House & Contents insurance – I have suggested Fred and Wilma look at this because this figure is unrealistically low for both house & contents. The typical average for house & contents insurance would be closer to $170/month.

House & Contents Insurance


67 67
Subtotal $67 $67  
Loan Repayments ($)  ($)
Mortgage 2,250 1,470 Their mortgage is a little above average, but what is really hurting them is the lifestyle debt. These debt levels had been creeping up over 5 years and the repayments are now robbing them of tomorrow’s cashflow. Fred and Wilma have gone interest only on the home loan so they can now focus the extra money at paying down high interest debt.
Personal Loan 1,005 1,005
GE Finance Loans 172 172
Car Loans 556 556
Combined Credit Cards 748 748
Subtotal $4,731 $3,951  
Total Expenditure $9,985.50 $8,181.50
Surplus/Deficit +$4.50 +$1,808.50


Overview of their situation

You will notice here, that based on the budget worksheets that Fred and Wilma have given me they had a $4.50 surplus even before we made changes. Fred and Wilma acknowledged that the budget worksheets aren’t an accurate representation of where they had been but a reflection of where they hope to be in the future.

With some tweaks to everyday spending and reducing the mortgage to interest only we have been able to free up $1,808.50, which we will use to build a cash reserve and then aggressively hammer down the lifestyle debt, one debt at a time.

How Fred & Wilma have progressed so far

At the time of writing this, Fred and Wilma have made huge progress.

  • Their budget is under control
  • They have a cash reserve of $5,000 in place
  • They are up to date on all their bills
  • They have paid off over $15,000 in debt

… Not bad for 10 months!

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