Top 5 Budgeting Tips for Ghanaian Expat Workers in the UK - All You Need To Know

You would have heard the word budget countless times all your life. But do you know what it means? How relevant is this word for you as an expatriate belonging to Ghana and residing in a country like the UK, which is known as one of the most expensive countries worldwide? Furthermore, can you realise the importance of budgeting when, as a Ghanaian expatriate, you work in a foreign country to financially support your family back home through an online money transfer to Ghana?

Well, this blog will tell you everything you need to know about budgeting and how to manage your expenses smartly.

A brief background about why people of Ghana travel to the UK and a brief look at the Ghanaian economy

With a nominal GDP of $3.198 trillion, ranking 6th largest worldwide, the UK is a robust economy offering several employment opportunities both to the natives and foreigners alike, hence the huge expatriate presence in the UK.

In addition to the strong and expansive job market, top-notch education in the UK is another big appeal for people to visit the country. But the people of Ghana, the world’s 75th largest economy with a nominal GDP of $74.26 billion, travel to the UK to find better financial prospects.

Because Ghana is an African country whose people suffer from unemployment and the ensuing poverty that makes life hard for them, the statistics below will give you a clear picture of the Ghanaians’ financial woes.

• Ghana is the 75th largest economy worldwide, with a nominal Gross Domestic Product (GDP) of $74.26 billion.
• Its Purchasing Power Parity (PPP) is $186.682 billion.
• Its nominal GDP per capita income is $2,374, ranking 163rd worldwide.
• Its nominal PPP per capita income is $5,968, ranking 165th worldwide.
• A report by the Office for National Statistics of the UK said that Ghanaian expatriates accounted for 114,000 residents across the UK in 2019.

The number of Ghanaians in the UK appears less, according to the report above. Still, due to the economic turmoil, Ghana has been undergoing, more and more people travel to the UK or other developed countries, for that matter, to find a decent means of living and send money to Ghana to their loved ones to offer financial support.

What is budgeting, and why is it important?

Budgeting is the process of projecting your income and expenses. It is a financial plan for the future based on the current incoming and outgoing flow of cash.

Both organisations and individuals can use the process of budgeting alike to track their income and expenses and create a financial plan for the future based on the available data.

Creating a financial plan through budgeting is important to keep an eye on your expenses and track your finances as a whole to prevent overspending and unknowingly depleting your emergency funds.

How to create a budget? What are the basic and necessary steps of the process?

The following are the basic steps involved in the process of making a budget.

Calculate your net income

The first step is to know how much your take-home salary is. It is also known as net income. It is the amount you earn fewer taxes. Make sure you calculate your income after certain deductions, like health insurance, etc., to get a clear picture.

List your monthly expenses.

As a second step, you need to list all of your monthly expenses. Make sure you list these expenses separately under different heads like rent, loan repayment, travelling, healthcare, education, utilities, etc. It will help you track your expenses in a more precise manner.

Separate fixed expenses from the variable expenses

After listing all of these expenses, make sure to separate fixed expenses from variable expenses. A simple example is a difference between your health expenses that vary from time to time and cannot be fixed. Whereas on the other hand, your rent remains the same and does not fluctuate much except annually or as mutually agreed upon by the parties.

Determine the monthly cost of each head

After separating the fixed and variable expenses, look at how much you spend on each head. Of course, there is little you can do about the fixed expenses as they do not vary much and frequently. But seeing your statement regularly helps you keep a check on your variable expenses.

Make adjustments where necessary.

As the last step, make sure you make adjustments in each variable expense head. Cut your expenses where you can and divert the unnecessary expenses to where they are most needed.

What do I do to optimise my savings after I have created the budget?

Creating a budget is not enough, even if you create it in an ideal manner but sticking to it and following it is. You create a budget to achieve a savings goal, which you can achieve by following the tips below as part of your budget.

• Always use public transport to move around.
• Cook meals at home and avoids eating out.
• Explore local cuisine instead of going for region-specific delicacies.
• Minimise your bills and share your internet with your neighbours if possible.
• Contribute to an emergency fund regularly.

Send money to Ghana online through credible service providers

Find a service provider whose exchange rates are live and competitive, which also charges a low fee for your remittance transfers back to Ghana to help you save money.

ACE Money Transfer – a service that exceeds your expectations

When you send money to Ghana online with ACE Money Transfer, you get safety, speed, 24/7 service access, around 390,000 pickup locations in over 100 countries worldwide, live and competitive currency exchange rates, and much more for a low fee from one window.