11 Expenses To Always Include In Your Budget (UK)

Creating a budget can be a bit challenging but budgeting monthly expenses and creating a savings plan will help you be prepared for financial hurdles along the way. Lucky for you, there are many great UK budgeting tools out there.

The key is to compare your monthly income to your monthly expenses and then sort through those to create a detailed plan for both spending and saving.

Let’s take a closer look at these expenses that should always be included in your budget.

Figuring Out Average Monthly Expenses

First things first, we need to plan your average monthly expenses so that you know the non-negotiable items as well as the items and spending that you might be able to adjust. You can use a budget planner spreadsheet or an income-expenditure form to help you here. Alternatively, you can start by making a list of monthly expenses to refer to.

Mortgage or Rent

When you list monthly expenses, your largest expense in the monthly budget is often going to be your housing. Every family budget needs to consider housing as an expense.

Utilities and House Bills

When you list monthly expenses, try to group things together on your income expenditure form. We just covered mortgage and rent, so now let’s consider average monthly expenses for things like utilities, insurance, taxes, and more.

Your insurance and taxes may be part of your mortgage, so don’t forget to include these when calculating your monthly budget expenses. Often, these are due annually so you may want to set aside a little each pay period to plan for those expenses when they do come around. 

As part of utilities and house bills, you should consider things like house maintenance and repairs as well as extra monthly household expenses like internet or phone bills.

Food and Groceries

A person has to eat, right? Your budget planner spreadsheet needs a line item in the monthly budget for this.

This can be divided up into two parts. One, you need grocery money. Consider what the personal budget is for buying groceries for the home. You can always look back at bank accounts to see what you are spending at the grocery store on a regular basis. The family budget will need a plan for groceries. 

Secondly, you will also need to consider food expenses for when you eat outside of the home. Part of budgeting monthly expenses is tracking your spending for eating out and maybe setting a dollar limit to control that type of spending as well.

Auto Expense

Monthly household expenses may include an auto expense. This is not an expense for everyone but if you don’t have your own car, you should plan your transit expenses instead. 

If you have your own transport, you will need to budget for any payments for the cost of the vehicle, as well as fuel, upkeep and repair requirements. You may have a lease or auto insurance as well, so include all of these details in your monthly household expenses as well. 

If you don’t own a personal auto, set aside some money on your budget planner spreadsheet to account for transit costs, whether those are the costs for public transit, a cab, or something similar. There are typically costs associated with these different transit options so you need to budget for those costs.

Debt Repayment

Debt comes in a variety of ways but it might include things like loans, lines of credit, or credit cards. Also factor in mortgages, auto payments, and student loans. 

We don’t want to overlook the value of repaying your debt. Paying on time and keeping things paid down directly affects your credit score and should be part of the average monthly expenses on your income expenditure form for budgeting.


Next in budgeting monthly expenses, consider your medical expenses. Do you have prescriptions that you regularly refill? Do you pay for health insurance out of pocket? Maybe you have frequent trips for medical purposes that require out of pocket payment from you to cover?

Whatever the case may be, you need to plan for these things. Plan for any premiums as well as prescription costs and out of pocket expenses that you might anticipate.

Obviously, we can’t always be prepared for every single medical need but we will talk about setting up a nest egg for the unexpected here in just a bit. 

Home Essentials

We talked about food and groceries as part of your monthly household expenses, but what about other essentials that you need to plan for and be able to purchase?

Some people already consider home essentials as part of their grocery budget, but we recommend separating these on your budget planner spreadsheet, for greater visibility.

How you categorise it is up to you, but be sure to account for it. Here are a few things you might have on this list. 

  • Paper goods (toilet paper, paper towels, plates, etc.)
  • Toiletries (shampoo, soap, feminine products, razors, etc.)
  • Dusting or cleaning supplies
  • Miscellaneous household items

Apart from things you use day to day, you also want to plan for times when you might need those extras. Maybe you need a new tablecloth or perhaps you just need office supplies this time around. Budget for these and other variable expenses for household items to have yourself covered. 

Student Loans

Don’t forget those pesky student loans. If you studied and used financial aid or loans of any kind, you’ll need to have a plan to repay those loans in your monthly budget. Debt repayment is absolutely vital and keeping things paid up and paid on time is an important part of your monthly budget.

Depending on what type of student loans you have, you may be able to set up specific or strategic repayment options but whatever you do, don’t just avoid them. 

Child Support or Alimony

Do you support your children or a prior spouse due to a separation or divorce? If you are required or ordered to pay child support or alimony, don’t neglect to cover these as part of your monthly household expenses. These are non-negotiable responsibilities and should be factored into your monthly expenses.

Miscellaneous Expenses

Apart from your regular expenses, you need to take into account variable expenses that you spend money on. If you’re not sure what variable expenses you have, take a look at your bank accounts for the past few months and take note of anything that doesn’t fall into a category here. Here are a few examples for you:

  • Gym membership
  • Hair appointment
  • Manicures or pedicures
  • Cell phone
  • Clothing or shopping
  • Entertainment
  • Home decor purchases 
  • Travel
  • Alcohol
  • Gifts for various occasions

Your miscellaneous expenses are variable expenses, but you typically know what your habits are. Some of these, like a gym membership, might be a constant while other things like gifts could be seasonal or only needed at certain times of the year.

However, the best way to budget for them is to plan for them, even if it means saving money throughout the year to prepare them. 


Saving should be part of your budgeting monthly expenses. We get it — sometimes there just isn’t a lot left over to save and some months may be harder than others.

However, you want to consider the need to save on your monthly household expenses still. Planning for saving money will hold you accountable in the best way possible.

Your savings can be used for a lot of different things when it comes to managing average monthly expenses. For example, savings can be just that — saving money for your future. However, you also create savings so that you have a nest egg in case you need it. 

Consider these things:

  • Need new tires
  • Car accident
  • Family emergency
  • Medical emergency
  • Christmas shopping
  • Major repair needs
  • Retirement 
  • University savings

This list could really go on and on and will truly depend on your own monthly household expenses as well as your goals and needs throughout the year.

Even if you can only save a little bit each month because of monthly household expenses, it will make a world of difference. Having that safety net will help you manage those expenditures you simply couldn’t budget for.

50-30-20 Budget Approach

Here is a great budget recommendation for you to try to help get things in line – or even a goal to work for. It is pretty common for financial planners to recommend saving about 20% of your monthly income. Most also point to this 50-30-20 rule. Here is the breakdown. 

  • 50% of your income to needs and routine expenses.
  • 30% of your income to extras and things you want.
  • 20% of your income to savings.

Final Thoughts

No matter what your situation is, a budget can help you get back on track and get your finances under control. Budgeting often means that you will need to cut back on expenses or perhaps work slowly to improve your financial standing. But rest assured, you can’t put a price on peace of mind.

About author

Fully qualified CISI Investment adviser for 5 year. Managed UK private client portfolios.
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