dropped ice cream on the ground, blog header image for how to budget for every season

Savvy saving: how to budget for every season

Sticking to a monthly budget can be a challenge for most people, even without the allure of summer social activities or an unexpected winter heating bill. While bills can be accounted for with careful consideration, seasonal events can sometimes throw a curve ball at even the best-laid monetary plans.

The seasons have more of an impact on our spending habits than we realise. In fact, impulse buys are reportedly more common during summer – showing a link between exposure to sunlight and on the spot purchases.

December is often the most expensive month for Aussies as it’s when we kick off our summer holidays and celebrate the silly season. Christmas, New Year's Eve, summer getaways – even unmissable festivals – can suddenly set you back financially if you haven’t set up a serious slush fund.

So, there's no time like the present to put a plan in place so you can cruise through the financial ebbs and flows of the calendar year.

Get a seasonal system in place

A great place to start is by setting up a system that not only takes care of the ‘must haves’ but also makes sure there’ll be enough wriggle room for the ‘nice to haves’.

A technique Andrew Woodward, founder of financial services firm The Investors Way, uses when speaking with clients is to encourage them to look back in order to look forward – when it comes to organising their money.

'Firstly, I want to see a 12-month historical view of how you spend your money. My solution to dealing with seasonal expenditure is to have a year’s snapshot of how you spend, then we allocate money into relevant bank accounts to accommodate,' he says.

'That way, when a big quarterly bill comes in like electricity, you've already been putting a weekly, fortnightly or monthly amount away for it. When your bills arrive, you can pay them and move on with no surprises or stress attached.'

Prepare your funds for fun

Think of it this way: you’re always told it’s smart to have an emergency fund, for the dishwasher that breaks down, or the car service that goes over capped pricing. So, why not have an emergency ‘fun’ fund? One that covers you for that last minute weekend away, birthday dinner with friends, or helps keep you afloat in the silly season.

'Budgets often don't incorporate seasonal things such as future travel, Christmas or birthday presents. When it comes to these less frequent periods, people tend to spend more because they're entertaining. That’s okay, we all deserve to have fun, but it takes the pressure off if you plan for it in advance,’ Andrew says.

By stashing some cash away each pay day now, you’ll slowly build up your own fun fund, so next summer your bank account is a little healthier than it would have been otherwise.

Embrace positive budgeting

Budget can feel like a dirty word, especially for anyone who doesn’t want money to dictate their daily lives. Andrew, however, says you don’t have to think about great financial planning as a restriction, au contraire – mindful money management can, in fact, set you free.

By signing up to the Virgin Money app, you can set up multiple side accounts to keep your financial life on track – no matter the occasion or time of year. The user-friendly digital banking app lets you manage your money on the go, know when your bills are coming up, see your savings grow, and even helps you build better money habits.

With automation on your side, money management becomes less stressful because fewer touch points mean your bills are getting paid without you needing to think about them.

Divide, automate and conquer

The Investor’s Way method uses five key accounts that can be used as placeholders for your money. Andrew swears by organisation and automation so suggests setting up the following:

The income account

This is where your salary lands. Money gets distributed from this account into sub-accounts for all of life’s little (and big) essentials, as well as any future adventures.

The everyday living account

Regardless of whether you're paid weekly, fortnightly or monthly, this account will cover ongoing things like your groceries and occasionally eating out.

The bills account

When first putting together your annual budget you’ll need to approximate how much you’ll spend throughout the year on bills. Set up an account exclusively for bills, then every time your wage is paid, a portion for future expenses will sit here and wait until each one is due.

The goals account

Here’s where the seasonal savings come in. Regular payments go to your goals account for things like Christmas, birthdays, travel or renovations. Basically, anything you think you’d like to do on the horizon. Funds are put aside here, and the sum accumulates until you want to cash in.

The pay-yourself-first account

What could be seen as a self-investment, this sum is dedicated to taking care of ‘future you’. This could be for when you can't work or simply choose not to. It’s where savings can be put towards shares, an investment property deposit, cryptocurrency – whatever you decide to bank on.

Ultimately, budgeting doesn’t have to be a burden – whatever the season, whatever the reason. With smart tech – like the Virgin Money app – on your side, saving and paying the bills has never been easier or more stress-free.

Become a savvy saver with Virgin Money

Download the Virgin Money app and open an account to start your annual budgeting today. Get on top of seasonal spending by automating your bills and setting up side accounts to maximise your savings. 

Virgin Money app