So, when trying to make due with what you’ve got, how do you even know what you’ve got?
Enter, THE BUDGET!
Yes, the idea of a budget may bring up some scary ideas or even make people cringe. But it’s actually liberating for me.
Why? Because I don’t have to worry about whether or not I can afford something or whether I am going to be able to pay for my groceries if I buy movie tickets or a new skirt. By knowing what I bring in each month and what I owe each month, I am free to choose how I spend and am confident that I will be able to be fiscally responsible.
There are many types of budgets that you can choose to use, but my preferred method is envelope budgeting. Envelope budgeting is a system where you allocate a certain amount of money to a category each month.
First, write down all your static monthly expenses such as rent/mortgage, utilities, cell phone bill, car payment, credit card payment, and so on. Then make a list of variable-cost categories such as groceries and miscellaneous spending money. Be sure to also include a category for savings so you will always have money set aside to go into your savings account each month.
I choose not to use cash and actual envelopes though. It is, after all, 2011 and I have my smartphone and checkcard with me all the time. So I use the Easy Envelope Budgeting Aid.