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Budgeting for Your Home Loan: Tracking Your Expenditure

Budgeting is a crucial habit that’ll have profound effects on the way you view money and spend it. It’s especially important when it comes to saving for the deposit on your home loan or making sure you have enough in the tank to make repayments.

A 2007 survey by the Financial Literacy foundation showed that 90 per cent of Australians were confident in their budgeting ability. And yet, 48 per cent of adults did not budget regularly for their daily finances.

Like paying your taxes or buying new rolls of toilet paper, it is hardly the most exciting thing; nothing is likely to ever change that. But, there’s plenty you can do to make sure all your efforts will pay off big for your financial confidence.


When it comes to saving for your variable or fixed home loan, the first thing you have to do is keep tabs on your expenses – it’s hard to know what costs to cut or control if you don’t know where your money has actually been going.

Go through and take note of all the transactions on your bank statement. Try not to be lax with this process and assume you already know where your day-to-day money has been going. Take a look at your financial records and you might actually find yourself surprised.

According to a September 18 interview with former treasurer Joe Hockey, Australians were spending over $100 million a day more than they were collecting in revenue. These less-than-ideal figures show that people could benefit from taking a closer look at their statements.

Note down money going both in and out of your account to get an idea of your spending habits versus your earnings.


Alternatively, consider a spending diary on your phone or a physical notebook, in which you can record everything you spend. And we mean everything: beverages, petrol, groceries, train tickets, party hats – all of it.

You’d be shocked how easily small purchases can build up to huge hole in your savings account. A 2013 release by Commonwealth Bank showed that the average spend on eating out was $70 per week, which totals $3,640 a year. Again, here’s where tracking your expenditure can prove useful.

The Australian Securities and Investments Commission recommends consistently noting down your spending over a fixed period you can stick to, such as a fortnight or month. Remember not to intentionally alter your spending habits during this time. At the end of this period, you now have a snapshot into your daily expenditure, which is the first step toward getting your account in fit shape for your home loan repayments.

Clearly, finding the right loan is just one part of the mortgage journey. After tracking your expenses, you’ll be ready to start the budgeting process.

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