Last updated: October 2026. General information only. If you are already missing priority bills or relying on borrowing for essentials, free debt advice can help.
If money seems to disappear every month, the first goal is not a perfect budget. It is to find out whether regular income covers regular spending and, if not, how large the gap is.
1. Calculate the real monthly gap
Use recent bank and card statements rather than memory. Add reliable take-home income, then essential bills, groceries, transport, debt payments, subscriptions and irregular costs converted into monthly amounts.
2. Protect essentials first
Housing, energy, food and essential transport come before lifestyle targets. A budgeting percentage such as 50/30/20 can help organise spending, but it should not make you feel you have failed if needs exceed 50%.
3. Remove costs that give you nothing
Start with forgotten subscriptions, duplicate services and memberships you no longer use. See our subscription audit.
4. Attack large recurring bills
Check broadband, mobile, insurance and other contracts. For broadband, compare what is available at your address and use One Touch Switch if you move.
5. Make groceries easier to control
Plan a few meals, shop with a list and test cheaper alternatives you genuinely like. Our downshift challenge is one way to experiment.
6. Build a small buffer when you can
If your budget moves into surplus, a small accessible cash reserve can reduce the damage from an unexpected expense. £1,000 is one possible first milestone, not a compulsory target.
7. If the numbers still don’t work
If essential outgoings remain above income, tiny lifestyle cuts may not solve the problem. Check benefit entitlement, council support and free debt advice. If you are behind on priority bills, seek help early.
Use our 50/30/20 guide as a flexible starting point.
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I know how it feels when the money runs out before the month does. When we arrived in the UK in 2008 with about £1,000, the financial crisis hit and my husband couldn’t find work for almost a year. We lived on my salary alone, and every pound had a job. What helped wasn’t a fancy spreadsheet; it was facing the numbers honestly, protecting the essentials and making small changes one week at a time. If you’re in that place right now, please be kind to yourself. You can turn this around, step by step.
If essential costs are still higher than your income, read our free money help UK guide for benefits checks, grants, help with bills and free advice.
Your first-month money makeover plan
When spending is higher than income, it helps to break things into small weekly steps rather than trying to fix everything at once.
- Week 1: List every bill, subscription and regular payment from your bank statements. Note what you can cancel or reduce.
- Week 2: Set a simple weekly budget for food and day-to-day spending, and track it in a notebook or app.
- Week 3: Call or switch one big bill, such as broadband, mobile or insurance.
- Week 4: Look for one way to bring in a little extra, like selling unused items.
If you are struggling with debt
If you are falling behind on priority bills like rent, council tax or energy, contact the company early and ask about payment plans. Free, confidential help is available from organisations such as StepChange, Citizens Advice and National Debtline. Avoid paying for debt advice, as good help is available free of charge.
A worked example: finding your monthly gap
Here’s a simple, made-up example to show how the numbers come together. Swap in your own figures from your bank statements.
| Per month | |
|---|---|
| Take-home pay (after tax) | £2,200 |
| Rent or mortgage | £950 |
| Council tax, energy and water | £320 |
| Food and household | £450 |
| Transport | £180 |
| Phone, broadband and subscriptions | £120 |
| Debt repayments | £150 |
| Irregular costs (birthdays, car, school), averaged | £100 |
| Total spending | £2,270 |
| Monthly gap | −£70 |
A £70 gap feels scary, but it’s also fixable: cancelling two unused subscriptions, switching one bill and trimming the food shop could close it. Knowing the exact number turns a worry into a plan.
Check for help you might be missing
Before cutting anything that matters, make sure you’re getting everything you’re entitled to. Free benefits calculators from Turn2us and entitledto take about 15 minutes. You might also qualify for the Warm Home Discount, Marriage Allowance, a council tax reduction or a social tariff for your broadband and phone. My free money help UK guide brings these together.
Quick wins you can do this week
- Cancel one subscription you haven’t used this month (my subscription cost calculator helps).
- Check whether a phone or broadband price rise is coming. See my guides to the O2 price increase and broadband price rises.
- Plan five dinners and shop with a list, using my cheap weekly shop guide.
- Sell one thing you no longer use. My Facebook groups guide shows how.
- Move a little money into a separate pot the day you’re paid, even if it’s just £5.
Talking about money as a family
Money worries feel lighter when they’re shared. A few gentle conversations can make your makeover far easier:
- Choose a calm moment, not the middle of a bill crisis.
- Share the goal, such as “I’d like us to stop running out before payday”, rather than blaming anyone.
- Agree one or two changes to try together for a month.
- Involve children in small, age-appropriate ways, like comparing prices or saving for a treat.
- Check in once a week for ten minutes and celebrate progress, however small.
When everyone understands the plan, it’s much easier to stick to it. If money is affecting your wellbeing, please talk to someone; you don’t have to manage it alone.
Keep your momentum going
Once your numbers balance, set one small next goal, such as building a £500 buffer or clearing one card. Write it down, automate a small payment towards it on payday and check in each month. My emergency fund calculator helps you see how long it will take.
Money makeover: your questions answered
What should I do if my spending is more than my income?
Start by working out the exact monthly gap from your bank statements. Then protect essentials, cancel costs that give you nothing, check you’re getting all the help you’re entitled to and look at bigger bills such as broadband, mobile and insurance. If the numbers still don’t work, get free debt advice early.
Which bills should I pay first?
Priority bills are the ones with the most serious consequences if you don’t pay, such as rent or mortgage, council tax, energy, and court fines. MoneyHelper explains how to prioritise your debts.
Where can I get free debt advice in the UK?
Free, confidential help is available from StepChange, Citizens Advice and National Debtline. You don’t need to pay for debt advice.
How do I work out a monthly budget?
List your take-home pay, then every regular cost, and turn irregular costs like birthdays and car repairs into a monthly amount. My 50/30/20 rule guide gives you a flexible way to organise it.
Should I save money while I’m paying off debt?
A small emergency buffer can stop you borrowing again when something unexpected happens. Many people build a small pot first, then focus on paying down debt. Start with whatever you can manage.
How much should I have in an emergency fund?
£1,000 is a good first milestone for many households, and later you might aim for a few months of essential costs. My £1,000 emergency fund guide shows how to build it gradually.
How long does a money makeover take?
You can make a real difference in a month by finding your gap, cancelling unused costs and switching one bill. Bigger changes, such as clearing debt or building savings, take longer, so focus on steady progress.
What is the first step in a money makeover?
Gather your last two or three months of bank statements and add up what comes in and what goes out. Knowing your real numbers is the foundation for everything else.
Remember, a money makeover isn’t about being perfect. It’s about knowing your numbers and making one good decision at a time. You’ve already taken the first step by reading this.
