Steps for a Basic Budget

Create a budget to regain control of your finances.

A basic budget can do wonders for your financial health, especially when money is tight and you need to save money or pay off a debt. While a budget might suggest that you need to give up some things in the short term, it can pay off big in the long term. Focus on making minor adjustments to save money rather than completely giving up things you enjoy. According to MSN Money, you are more likely to stick to your budget when you give yourself a weekly spending allowance rather than restrict yourself entirely.

Instructions

1. Sort out your monthly bills such as rent, utilities, debt and groceries.

2. Compare how much you make with how much you're spending, and determine where you can reduce spending. For example, can you shop at a less expensive supermarket or find ways to make your grocery money go further? Can you carry your lunch to work and take public transportation rather than driving and eating out?

3. Keep a daily purchase journal to keep track of how much you spend each day. Small impulse purchases easily add up and can be a drain on your income.

4. Give yourself a small allowance that you can use for special clothes, cosmetics or other little luxuries.

5. Set aside 10 percent of your paycheck to a savings account or emergency account.

References

• MSN Money: Your 5-minute Guide to Budgeting
• Real Simple: How to Save Money Without Giving Up Too Much