25 Nov 2022
You would have heard the word budget countless times all your life. But do you know what it means? How relevant is this word for you as an expatriate belonging to Ghana and residing in a country like the UK, which is known as one of the most expensive countries worldwide? Furthermore, can you realise the importance of budgeting when, as a Ghanaian expatriate, you work in a foreign country to financially support your family back home through an online money transfer to Ghana?
Well, this blog will tell you everything you need to know about budgeting and how to manage your expenses smartly.
With a nominal GDP of $3.198 trillion, ranking 6th largest worldwide, the UK is a robust economy offering several employment opportunities both to the natives and foreigners alike, hence the huge expatriate presence in the UK.
In addition to the strong and expansive job market, top-notch education in the UK is another big appeal for people to visit the country. But the people of Ghana, the world’s 75th largest economy with a nominal GDP of $74.26 billion, travel to the UK to find better financial prospects.
Because Ghana is an African country whose people suffer from unemployment and the ensuing poverty that makes life hard for them, the statistics below will give you a clear picture of the Ghanaians’ financial woes.
The number of Ghanaians in the UK appears less, according to the report above. Still, due to the economic turmoil, Ghana has been undergoing, more and more people travel to the UK or other developed countries, for that matter, to find a decent means of living and send money to Ghana to their loved ones to offer financial support.
Budgeting is the process of projecting your income and expenses. It is a financial plan for the future based on the current incoming and outgoing flow of cash.
Both organisations and individuals can use the process of budgeting alike to track their income and expenses and create a financial plan for the future based on the available data.
Creating a financial plan through budgeting is important to keep an eye on your expenses and track your finances as a whole to prevent overspending and unknowingly depleting your emergency funds.
The following are the basic steps involved in the process of making a budget.
The first step is to know how much your take-home salary is. It is also known as net income. It is the amount you earn fewer taxes. Make sure you calculate your income after certain deductions, like health insurance, etc., to get a clear picture.
As a second step, you need to list all of your monthly expenses. Make sure you list these expenses separately under different heads like rent, loan repayment, travelling, healthcare, education, utilities, etc. It will help you track your expenses in a more precise manner.
After listing all of these expenses, make sure to separate fixed expenses from variable expenses. A simple example is a difference between your health expenses that vary from time to time and cannot be fixed. Whereas on the other hand, your rent remains the same and does not fluctuate much except annually or as mutually agreed upon by the parties.
After separating the fixed and variable expenses, look at how much you spend on each head. Of course, there is little you can do about the fixed expenses as they do not vary much and frequently. But seeing your statement regularly helps you keep a check on your variable expenses.
As the last step, make sure you make adjustments in each variable expense head. Cut your expenses where you can and divert the unnecessary expenses to where they are most needed.
Creating a budget is not enough, even if you create it in an ideal manner but sticking to it and following it is. You create a budget to achieve a savings goal, which you can achieve by following the tips below as part of your budget.
Find a service provider whose exchange rates are live and competitive, which also charges a low fee for your remittance transfers back to Ghana to help you save money.
When you send money to Ghana online with ACE Money Transfer, you get safety, speed, 24/7 service access, around 390,000 pickup locations in over 100 countries worldwide, live and competitive currency exchange rates, and much more for a low fee from one window.