"Creating a budget." How do those words make you feel?
I think it's safe to say that no one likes to have to live within a budget but creating a budget is a necessary evil. Creating a budget and following it is the only practical way to control your spending and to ensure that your money is being used the way you want it to be.
When you decide that creating a budget is the way to go, there are generally four steps.
- Figure out where your money is being spent.
- Set goals to meet your long term financial plans.
- Track your spending to make sure you stay within your budget.
- To make the job easier, use budget software with built in budget making tools.
Just the though of creating a budget can make you crazy. It brings up feelings of anxiety and frustration. Creating a budget should not stress you out and one way to make it easier is to break it down into steps. Taking the process in smaller steps makes it easier to complete the whole job.
But, do not let creating a budget control your life. It can be easy to over-zealously monitor your money and obsess over every penny that is spent. While you do need to monitor what you spend, you can not let it take over your life. Focus on the categories of your budget where you have determined that you can cut spending and do not worry so much about the rest.
Keep a careful watch of impulses purchases which can result from ATM withdrawals. Impulsive purchases can really add up and money taken from ATMs can disappear in a flash. If it is a problem, then you may have to ban ATM cash. There is almost no place on the planet that will not take a debit card so there really is no reason to take cash out.
If you have found that you are spending more money than you bring in every month then something has to be done. Either you need to strictly cut spending or you may need to get a new job that pays more or add a second job. You have either have to make more or spend less or you will end up with some serious financial problems.