Budgeting 101

Learn How to Manage Your Money

If you've never budgeted your money before, it can seem pretty intimidating.  Balancing a budget and saving money can be easy if you know what it takes for you to do it successfully.  Read on for easy tips to help you manage your money:

* Keep a separate savings account.  Separating your savings from your money for monthly expensesBudgeting for Beginners helps you not to spend your savings because it takes extra effort to pull it out of another account (which by the way you should avoid).  If you want to make it more difficult to get instant access to the money you set aside, open up a savings account at an online bank like ING Direct.
* Track your small daily purchases every month and add them up.  This will give you a good idea of how much you spend every month and what you spend it on.  If those small purchases do not align with your values and budgeting goals, then you can adjust your daily spending the next month.
* Avoid going into debt.  If you want something, hold off on buying it until you can save up the money for it.  Don't purchase what you want with a credit card if you don't have the cash to pay for it.  Don't give in to your immediate desires.  Wait until you have the money to buy it.  
* Set up a direct deposit into your savings every month out of your paycheck.  If it goes directly into another account, you don't miss that amount and soon it will start to accumulate.  This is the easiest way to build up savings or an emergency fund.
* Pay your bills on time.  I'm including monthly expenses and credit cards here.  When you pay a bill late, you may end up getting charged extra for your late payment.  Finance charges (due to a late payment) can add up so that you're never really paying off that bill.  Avoid finance charges and pay on time.  Even better, once you're adhering to your budget, you may even be able to pay bills in advance, thereby always avoiding late charges.
* Determine the focus for your budgeting.  This helps you to stay focused and limit your spending so that you're following your budget.  If your focus is to pay off your credit card debt, put that somewhere prominent in your written budget and it wouldn't hurt to add a sign (or ten) to that effect around your house as well.
    Developing and maintaining a budget is really just a matter of tracking your expenses and storing away some money in savings every month.  Once you start budgeting and tracking spending, you'll be shocked at how fast the savings add up!