Functional Skills Maths: Budgeting

Plan your money so it lasts

What is a Budget?

  • A budget is a plan for your money.
  • Income: money coming in (wages, benefits, pocket money).
  • Spending: money going out (food, travel, bills).
  • A good budget means spending less than or equal to income.

Adding Up Your Spending

  • List every cost before you spend.
  • Example: Food £30 + Travel £10 + Phone £5 = £45.
  • If income is £50 and spending is £45, you save £5.
  • Always check totals before you buy.

Staying in Budget

  • If spending is more than income, you are in debt.
  • Cut back on non-essential spending first.
  • Even saving £1 per week adds up over time.

Worked Examples

Example 1: Weekly budget

  1. Income: £60 per week.
  2. Food £25 + Travel £10 + Phone £5 = £40 spending.
  3. Left over: £60 − £40 = £20.
  4. The budget is balanced — there is money left.

Example 2: Monthly budget

  1. Income: £400.
  2. Rent £150, Food £100, Travel £80 = £330 total spending.
  3. Left: £400 − £330 = £70.

Practice Questions

  • Income £80. Spending £65. How much is left?
    Hint: Subtract spending from income: £80 − £65.
    Answer: £15
  • Food £30 + travel £15 + phone £5 = total spending?
    Hint: Add all three costs together.
    Answer: £50
  • Income £120, spending £135. Is this balanced?
    Hint: Is spending more or less than income?
    Answer: No — overspending by £15
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