Budgeting: A Tough Love Way to Handle Your Household Budget

Developing and living by a household budget is by far the best way to get your expenses under control which, in turn, can mean a much less stressful life.

However, many families find it very difficult to stick to a budget. It does take hard work and a lot of self-discipline, at least in the beginning. The good news is that most families find the longer they can stick to a budget, the easier it becomes. This is because sticking to a budget eventually becomes an unconscious habit, just like driving a car. And once it becomes a habit, the budgeting process just sort of goes on cruise control and requires much less thought or effort.

But what do you do during those first three, four or six months, when sticking to a budget feels so difficult?

There are several answers to this. The first is to make sure your budget categories are realistic. You may think you can get by with $100 a week for groceries, but is this real? Do you have checks or receipts that verify how much you have been spending at the grocery store? You really need to know. Otherwise, you may budget too little. In turn, this becomes frustrating because you will always be over budget.

Second, make sure you have all categories covered. There are some categories that are easy -- rent, mortgage payment, utilities, car payments, etc. But think hard about all other categories such as clothing, eating out, prescriptions, pet care, tuition, books, allowances, movies, CDs and DVDs, and computer software and games, to name a few. If you don't budget for all these kind of expenses, I promise they will bust your budget.

Finally, if you find you just can't seem to stick to your budget, here's a sort of tough love answer.

Go to your nearest office supply store and buy a box of #10 envelopes. Take them out and label one for each of your budget categories. Then write on each envelope the amount you have budgeted for that category.

For the purpose of this exercise, it is not necessary to break down general categories into subcategories. For example, you can label one envelope "entertainment" and not worry about envelopes for "movies," "eating out," "DVDs," etc. Just be sure the number you write on the envelope for any general category represents the sum of all its subcategories.

When you next get paid, cash your paycheck and bring it all home in $50, $20 and $10 bills. Then put and amount of cash in each of the envelopes equal to the amount you budgeted for that particular 6category.

Now, as you need to pay bills or buy groceries, etc., use the cash in the corresponding envelopes to pay them. You will know when you have reached the budgeted amount for any category because its envelope will be empty. What do you do when you find an envelope is empty? You do nothing. That category is all finished for this pay period. If the envelope is empty and you still have expenses, either you haven't budgeted correctly or you have overspent. You might be able to fudge and take funds from another category envelope. For example, if you have a week to go and are $40 short for groceries, you might be able to take the $40 out of the entertainment envelope. Just keep in mind this means $40 less for entertainment.

Do this for a few months and I promise you will not only learn to budget accurately, you will learn to stick to your budget.

For FREE help with debt and credit, subscribe today to Douglas Hanna's free email newsletter "8 Simple Steps to Debt Relief" at http://www.all-in-one-info.com

In The News:

Financial Planning 2022: 10 Key Steps  Investor's Business Daily
Is Budgeting Overrated?  Kiplinger's Personal Finance

Are You Sick of the Financial Insecurity of Fluctuating Seasons and Income?

Finding a stable and secure income that will come year... Read More

Banks Are More Than Just A Place To Park Your Money

If you've been to a shopping mall lately, you've probably... Read More

Personal Finance - Have Consumers Had a Belly Full of Personal Debt?

For months, we were trigger-swipe happy, putting our groceries, clothes,... Read More

7 Simple Ways To Save Money

Each of us knows how to spend money, but do... Read More

Financial Readiness: Preparing for BRAC (Base Realignment And Closing)

The recommendations for military base closings have been released and... Read More

Introduction to Australian Superannuation

Australians, in general, constitute some of the worst savers in... Read More

Single Mother and Learning how to Save

Saving may seem easier if you were saving for a... Read More

Make or Break Your Retirement!

The Prudential has dubbed those who refuse to leave home... Read More

When do You Need a Financial Management Company on Your Side?

We live in a crazy world. Someone ought to sell... Read More

Single Mother Resources Directs You Towards Success

As a parent you are bound to face a few... Read More

University: A Course in Personal Finance

Recent findings from the Educational Policy Institute indicated that the... Read More

Saving Money On Gasoline For Your Automobile

The gas that we fill our tanks with every week... Read More

Stretching Your Grocery Dollars

Shopping for groceries is an inevitable fact of our ever... Read More

The World is Not Enough - Calling for a More Ethical Approach to Personal Finance

At a time when the entire world's attention is focused... Read More

Do You Really Need the Power of Money Management Software?

I have been a loyal user of Quicken(R) for more... Read More

Saving Dimes Can Go a Long Way

On the other hand, there are those people who are... Read More

Eight Ways To Sink Yourself Financially

1. Don't focus on your finances.The reason most people get... Read More

Can You Afford Not To Look After Your Personal Finances?

Investing is a subject a lot of people don't want... Read More

Improving Your Financial Position

If you want money you need to learn how to... Read More

Save Money on Groceries: Part I

One universal of humanity, no matter who you are or... Read More

Improve Your Professional Image Using Address Labels

One of the simplest ways to improve your professional image... Read More

How Electronic Checks Work ? Will Paper Checks Eventually Go Away?

Traditional checks probably won't disappear anytime soon, but processing checks... Read More

How to Draw a Personal Budget that Works

Many people spend their little income haphazardly without any planning... Read More

Planning Your Financial Future

Millions of people give a lot of thought to financial... Read More

Financing Collectibles for Fun and Profit

With the advent of the internet and especially auction services... Read More