Budgets are just one of those things where you mention it to people and you can watch them visibly cringe at the thought of tracking their money. It’s boring, they say, and time-consuming, and they can’t ever really stick to one, so why bother?
Because it will help you save, that’s why.
Now, I’m not saying that you have to go out and track every penny that goes in and out of your bank account. If you have trouble sticking to a budget, then try to implement something more flexible. Rather than give yourself a set amount of money to spend, give yourself a flexible range of spending. After all, we tend to spend a lot more on some weeks than others (especially if you go out to the bars, in the city….), so giving yourself a flexible range that you can get comfortable with. Not everything is about pinching pennies, but setting reasonable amounts aside will help you save.
Keeping track of what you do spend on things you want, rather than need (and there isn’t anything wrong with that!) is also particularly important. Often-times you’ll find yourself shocked at how much really goes into eating out and seeing a movie on the weekend. If you’re looking for a great example of tracking discretionary spending, check out this post by JD at GetRichSlowly.
If you’re like me, tracking expenses via paper just sounds downright painful. While I do in fact keep a notebook on hand at all times to jot down when I go out to eat or grab a beer at our local watering hole, there’s an easy way to track your finances online. Services like Mint or Wesabe offer free services that allow you to upload your bank statements and create charts/graphs of your spending from month to month.
Utilizing these methods allows you the opportunity to get in control of your money and find out how much you really can save if you put your mind to it. It’s important to realize that saving, investing, and creating income are all ongoing processes. There’s always a new trick for you to learn just around the corner, so be creative and read the vast amount of information available for ideas you can expand upon.