We have covered budgeting plenty of times on this blog. From student-friendly budgets to summer budgets, we have investigated how to make saving money work for most occasions. But we haven’t covered the four non-negotiables of budgeting!

The four non-negotiables of budgeting must be applied to every budget. These cover your basic personal finance needs and help you prioritise vital expenses. So, if you are new to budgeting or need personal finance help, this is the place to start.

Ready? Grab a notebook, and let’s create a foolproof budget.

1. Food Costs

The first consideration in any budget should be food costs. And no, we are not talking about eating out or expensive dinners. We are talking about the standard grocery bill that will keep you fed.

If you are starting a UK budgeting plan, you should work out your weekly shop expenses. This will be the first portion of your budget.

Our shopping costs tend to differ every week, so looking at the average from the past few months can be helpful. Remember not to include any luxury items in this. Only look at the basics.

According to the ONS, the average household weekly spend on food and non-alcoholic drinks (from 2019-21) in the UK was £69.20. How does your spending add up?

2. Money For Rent or Mortgage

Next, you need to set aside a chunk of money to cover your rent or mortgage costs. Like food, a roof over your head is essential. Put this payment ahead of all your non-essential purchases!

Every budgeting for beginners guide will remind you of this category, but it is still important that you don’t forget it. Falling behind with rent payments can be a stressful situation, so having this expense clearly covered in your budget is critical.

Recent Zoopla facts state the average rent in the UK is £1,223. It is highest in London (£2,121) and lowest in the North East (£695).

3. Essential Bills

After food and accommodation costs, it is time to cover your essential bills.

These typically include:

  • Electricity
  • Gas
  • Water
  • Council Tax

Saving money in the UK might seem tough when all prices are going up. But it is possible when you follow this plan!

If you can, create a direct debit so you don’t have to make your bill payments manually. This will prevent you from spending the allocated bill costs and ensure your payments are always on time.

4. Income Earning Expenses

Lastly, the final category of the budgeting basics is income-earning expenses. This topic is less spoken about than the others, but it is just as essential to ensure you can get to work and make money to fund your budget!

What are income-earning expenses? They include travel costs, uniform costs and software subscriptions needed for work. For business owners or self-employed people, this can also include employee wages, accountancy fees and inventory purchases.

What Next?

If you have covered the items above and have some cash to spare, there are more categories to consider before spending on the fun stuff.

You may want to start building a small emergency fund covering a month's expenses or put money aside for higher pension contributions. It is also important to remember that you have enough money to make at least the minimum payments required for any existing credit commitments that you have.

Any leftover cash can then be used for important but not always essential bills, like TV, phone, internet and streaming services. Basically, keep covering your important outgoings before you spend on clothes, holidays or meals out.

How to Start Budgeting - The Takeaway

Budgeting is not the most exciting task in the world, but it does leave you feeling satisfied when it is done. Bookmark this page so you can come back and check you are covering the budgeting basics. Now go forth and be confident in your finances!

Or keep learning. Visit the Cash ASAP blog today for more information.