Allocate Funds for Your Nest Egg And "Wants" Costs

Once you have your money set aside for the basic needs, the rest of the money is your "spending money." Obviously, there's no way to fully detail all the things you'll have to spend money on, but think of your costs for entertainment, clothes, a new stereo, cell phone, dinners out, vacations and so on. Because each week is different, it's hard to budget your spending money to the cent. But what you can do is keep track (preferably on paper) of your spending so that you pace yourself until the next payday.

Life is unpredictable and if you do lose your job, you'll need some money until you get back on your feet. Hence, you may want to make "savings" a part of your "needs." If so, just add it in (after you pay the bills, you can transfer the remainder into an actual savings account)--and we commend you for your diligence. The best strategy is to set up an actual savings account (separate from your checking account) with your bank. Then, each week, as soon as you get your paycheck, transfer however much you'd like right into that account. Some banks allow you to do this right over the Web. And don't forget, you'll get interest on your savings.

Next: Stick to Your Budget

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