How To Stick To A Budget

Having a budget is more important than ever before, but sticking to one takes time and discipline. Here are ways to help you become a better money manager.  Track your spending. Most people spend their money on food, housing and transportation, but there are many other categories, like household costs, debt payments and entertainment. Try this: Write down every dollar you spend in a two-week period and see what you can cut on the list. Doing this with your spouse and your family members will turn up even more surprises.  Account for your cash. Does it just “disappear” from your wallet? Try tracking where it is spent. Sometimes, using debit or credit cards for expenditures can help with accounting.  Understand your debt (mortgage, student loans, credit cards) and set goals to reduce it. Federal Reserve statistics say the average household owes $7,529 on their cards. For indebted households, the average is $16,140. This is a major undertaking, but check out sites like www.creditcards.com for ideas on how to deal with high debt (for example, negotiate lower interest rates).  Have a savings goal, including an emergency fund, as part of your budget. What if you need major car repairs or a new furnace? Start small and add to this category gradually or you’ll have to fall back on those credit cards. For long-term planning, review your investments and consult an expert if you need one.  Use a tool like Mint.com, Quicken or Google Docs spreadsheets. They’re inexpensive or free and make it easier to track and categorize your expenses, set budgets, create reports and more.