How to Create and Stick to a Budget

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How to Create and Stick to a Budget.

The first step to avoiding what I like to call “hazardous finances” is to create and stick to a budget. It’s not as intimidating as it sounds, don’t worry. If I can do it, you can do it.

According to recent research, 19% of us have no emergency savings, and 31% of us have less than $500 in emergency savings.

Finances are kind of like a road trip; if you don’t make a plan or set a course, how will you know how to get where you’re going?

Here’s How to Create and Stick to a Budget.

Like I said before, in order to know where you’re going, you’ve gotta make a plan to get there…or a map.

So in order to know where you’re going financially, you should set a goal. Doesn’t matter what that goal is. Everyone’s is different.



Create a list of all of your monthly income (I mean every nickel), and then create a list of your monthly expenses.

When figuring out your income, write down all sources, including your regular paycheck, any alimony, child support, side jobs, etc.

When you’re calculating your expenses, make sure you include housing, food, transportation, utilities, entertainment, etc. To get an accurate picture of how much you need to spend (or your expenses) every month, make sure you save your receipts. Do the math; see if your income covers all of your expenses. If it doesn’t, then you’ve got some ‘shaving’ to do.

When your income doesn’t cover your expenses, you need to adjust your expenses. If it’s a small discrepancy, it can mean cutting out some minor spending, like entertainment, reducing your cell phone plan, or it could be as simple as making your own coffee in the am, instead of stopping at your favorite coffee shop.

(When I did my own budget, there were some minor ways that I could reduce my spending. One of those things was to stop buying ink for my printer the way that I was buying it. That shaved about $75 a month from my spending!)

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If the gap is much larger, you’re gonna need to downsize your vehicle or find a less expensive place to live. If your income covers all of your expenses, you could still think about trimming some of the “excess fat” from your spending habits. This will easily free up extra dough for things like vacations or college funds for your children.

Additionally, when you’re working on how to create and stick to a budget, consider whether or not you need to add new categories to your budget.

Some areas that are often overlooked are debt reduction, emergency savings funds, and retirement savings. An emergency fund makes sure that there’s an enough available to cover unforeseen events (car emergency, etc), should it happen. This eliminates the need for using those damned credit cards, that can quickly, and drastically sink your budget.

There are actually huge advantages to sticking to your budget.

First, most people have set financial goals that they’d like to reach at some point in the future. It could be a trip, a new car, or a college education. A budget can help you save money to make those goals a reality.

Without a disciplined plan for your spending, it’s virtually impossible to make much headway in reducing debt. A family/personal budget will provide the necessary framework to start eliminating these crazy inflated account balances.

When executed properly, a budget can allow you to simultaneously manage your expenses, put some money into savings, and pay back your debts.

Peace 🙂

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