By: Allison B.

Budgeting for someone who is used to spending money seems daunting. It seems like an impossible task. It’s easier for most people to spend what they earn and deal with the consequences later. Most people think living on a budget means you don’t get to enjoy what life has to offer. They dismiss the idea of sticking to a plan can lead you to a financial freedom one day. Here are some tips you can use to create a simple budget plan.

The first time you sit down to create a budget can get overwhelming. You have to know where you are in life first. You have to know what much you make and how much you spend monthly in order to maintain the lifestyle you created for yourself. Budgeting is a change in lifestyle. If you can’t complete all the steps in one day, take the time to complete in a few days or in a week.

* The first thing in creating a plan is to know where you are financially. So let’s gather all your information. Get your paycheck stubs, checkbook, bank statements, credit card statements, bills, and any other paperwork you may have. Once you have all the paperwork, it is probably best to organize them in separate folders and label them accordingly. It helps to have everything in one place if you have to search for any paperwork in the future.

* Once you have all the paperwork in one place, let’s make a list of how much you make a month. This includes your income from work, weekend and side jobs, any profits you receive selling online or offline, stock dividends, interest, etc. per month. If you have sporadic income, take a conservative guess at what you earn in a normal month.

* In order to see where your money is going, the next thing is to list all your expenses. Get a piece of paper to create two columns with Fixed Expenses and Discretionary Expenses. List payroll deductions, rent or mortgage, property taxes, insurance, car payment, utility bills, credit card payments, and savings under fixed column. List other expenses such as groceries, gasoline, eating out, shopping, and other expenses in the discretionary column. Add up everything under each column and you’ll get a clear picture of where the money is going.

* Now it’s time to compare your income to your expenses. If the total amount of your income column is higher than your total expenses, then you’re in good shape. However, if you expenses are higher than your income, it’s time to re-think your spending habits. That’s why it is important to write down all your spending. What you may not realize is that you’re probably spending a couple of dollars here and there without thinking about it. Now that you know where you’re spending, you can watch out where you can cut your expenses to make the total expenses lower than your income. That’s the only way to get out of debt and start saving.

* If you really want that financial freedom, you have to get serious about creating a plan that you can stick to. The hardest part about budgeting is sticking with it. It’s tough to say no to your friends when they want to chill or coworkers when they need to grab a drink at the end of the full workweek. You have to make sacrifices if you want to succeed. Take less shopping trips, or go out only when it’s a special celebration like birthday or promotion.

Once you know where you are financially, you can make decisions that can set you on the path to financial peace of mind. You can search for more financial resources that are available at the library or online.

By: Allison B.

If you find yourself living from paycheck to paycheck these days, you are not alone. There are things you can do to make the most of your income and live comfortably at the same time. So if you’re struggling to pay monthly bills, take a closer look at all your expenses. You will be surprised to find out how much you are spending mindlessly. Follow these steps and they will help you reduce your monthly expenses.

The first thing you should look at is your utilities. During summer months, your electricity bill can get very high. So remember to turn off the lights when not in use and only turn on the air conditioning when you’re home. Follow these steps and you’re on your way to lowering your utilities over the year.

Bringing your lunch to work is another way to reduce your monthly expenses. We all like the idea of grabbing something quick and easy versus making a sandwich for lunch. While this is great for local businesses, you should know that you’re putting a bigger hole in your wallet. Enjoying a meal out once in a while is not harmful, eating out everyday can add up. When you pack your lunch at home, you can choose healthier ingredients and control your portions. This can trim your budget as well as your waistline.

A night at the movies can get very expensive by the time you bought your tickets, popcorn and drinks for everyone. One of the ways you can save money on movie tickets is to see if the theater near you offers discounts to senior citizens and students. Another is to see if the theater offers pre-matinee or matinee shows. These shows are a lot cheaper and less crowded than the evening shows.

Saving money on daily expenses is not hard if you know where to cut. The hardest part about this process is the adjustment that goes with it. Take a closer look at your bills and you’ll realize that you’ve been spending more money than you should have. Hopefully following these tips will trigger you to start spending smart in other areas of your life.