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It is very important to make a budget so that you can take control of your finances and begin to plan financially for the future.  It is impossible to know how much you are spending unless you keep track of your finances and create a budget to make sure that you don’t spend more than you can afford.  Here are some simple tips for creating a budget that is simple to follow.

Start by listing all of your expenses and the amount that you spend on each expense each month.  The list should include necessary expenses that must be paid monthly and discretionary expenses that are more of a choice than an obligation.  This will give you a good picture of your spending habits, showing you where your money goes each month.

After you have made a list of all of your expenses, look for areas where you can trim your costs.  For example, if you have the deluxe cable package but are rarely ever home to watch television, you may want to consider downgrading to a basic cable package that costs less or getting rid of the cable package altogether and watching movies or online content for entertainment.  Most people can find multiple areas where costs can be reduced once they can see where their money is going.

Once you have decided on what expenses are necessary and which ones can be eliminated, it is time to create a spending plan.  The spending plan must be detailed to ensure that all of your bases are covered when it comes to spending.  List each of the expenses that are important to you and the amount that you should be spending in each category each month.  Be sure to include savings in your savings plan of at least 10% of your income to make sure that you have enough saved to take care of an emergency situation without having to use credit.

The list that you have just created should be your spending plan for your budget.  It may need to be tweaked a little bit in the first few months of using the budgeting plan as you find that your estimates of how much you spend are wrong or when forgotten expenses arise.  Outside of these small tweaks to the spending amounts or addition of new spending categories, you should try to stick to this budgeting plan as closely as possible.

Although it may be hard in the beginning, as you continue to follow the budget that you have created, you will find that it will become easier and easier to stick to the plan.  Diverting the recommended amount to savings will help your savings account grow quickly and ensure that you have money available for emergency expenses.  Creating a budget and sticking to it is a great way to monitor your spending and secure your financial future.