Piggy BankWe all like the idea of budgeting because when we think of budgets we think of saving money. Therefore it's very important that you stick to your budget. When budgeting you got to get yourself in a routine of becoming aware of you're spending and discipline yourself to daily keep track of what you spent even to the piece of gum you buy at the convenience store. Once you get a hand of budgeting, it's simple and you will be so glad that you did because you will actually start to see yourself saving more money because you will get delight out of not going over the budget. When you begin deciding that you want to budget you need to seriously think about monthly budgeting and to have a way to track your daily expenses and then every month you can see where you money went and how much you didn't spend.

The reason to budget is a no brainier – it saves money! You become more consciousness of your money and you're spending. You tend to not spend as much money because you want to see money left over in your different categories. Breaking your budget down into categories is the key to budgeting.

First thing you want to do is write down all your monthly bills and expenses. Trust me, your not going to remember them all at first because you will forget about the little things like your car wash or hair cuts. You need to come up with different categories such as your fixed bills including Phone Bill, Power, Mortgage, etc but then you need to also list your entertainment categories such as eating out, movies, vacation, etc. But try to brainstorm and write down everything you can think of on a piece of paper. It will take you a month or two to really get your budget completed. No beside each expense, write down the cost you spend on this item monthly (and round up) or if they fluctuate then you need to put down the high average of this bill. For example if every month your family spends $450 – $500 on groceries write down $500. After you have a list of expense for a month and how much each one costs then it's time to add these up and you have a grand total of your monthly expenses. Shocking isn't it? Bet you didn't realize how much you spend every month?

Now you need to total up your income. This shouldn't be as hard as the expenses defiantly if you only have a few streams of income. Add up all your income and this should be more than your expenses, HOPEFULLY if not then you need to go back to your expenses and try to cut back. You can always get a part time job to help with some of your expenses. There are lots of other articles to read about how to make money working part-time from home in your spare time.

Now it's just a matter of taking a step back and reviewing where your money is coming from and where it's going each month. It's a good idea to set a ceiling for each expense and tell your family that once you've spend X amount of dollars in the "eating out" category for that month then there will be no more Pizza Hut trips until next month or so forth. This way you will never go over your budget.

You might want to create a excel spreadsheet to keep up with your budget monthly. On the worksheet you will have one column with your expenses and another for the income. You need to set up different columns one for Budget, Spent and then Left over Money. In the budget column will be the number you listed beside each expense that you plan on spending monthly. The spent column is where you daily keep totaling how much you spend in the category and then it will calculate how much is left over in that expense. Learn to do this daily to keep up with all your expenses. Then every month review and see how much you spend and how much you actually saved.

Here is a sample list of what your budget categories might include: Mortgage, Groceries, Gas, Power Bill, Car Insurance, House Insurance, Car Tags, Home Taxes, Cell Phone Bill, Cable, Internet, Water, Garbage, Christmas, Home Improvement, Clothes, Gifts, Movies, Eating Out, Vacation, Hair Cut, Car Expenses, Misc.