For most people, life seems increasingly busy. The demands of our time lead us in many different directions, and it can be difficult to focus our time and energy on important household matters, such as where we spend our money each month. The simple premise of any budget is to spend less money than what you bring. Some authors write entire books on the subject of budgeting, but it doesn’t have to be as complicated or require hours of dry reading. Here are 5 simple and effective ways to keep your monthly budget under control and be on your way to a happier, stress-free life … with more money to spend and save!

1. Create a monthly budget worksheet.

This will become the road map to get your finances in order. Try to create one that spans a whole year so that you can easily refer to previous months and keep track of the progress you are making.
The first section of the spreadsheet should be used for monthly invoices over which you have limited control; things like rent or mortgage, utility bills, insurance and all the other evils necessary in your life. Once you have listed these invoices, create two columns next to each; one to document how much you plan to spend to pay the bill and one to document what you ended up paying. Any additional funds from subtracting these two totals become bonus money!
to list the bills over which you have control, although this may sometimes not be the case! This section should be used for medical bills, credit card bills, and any loans you have. You can call this section the “light at the end of the tunnel” section because you will eventually access it using your spreadsheet! As in the first section, make two columns next to each item listed. In the first column, note the amount you will pay on this invoice each month and in the second column, note the total you owe on this invoice minus the payment you make. The second column is the rewards column because you can see the amount of debt going down!
Last, but not least, the pocket money, savings, and income section. This is where life gets a little more fun as it is the section with the net total you will have after paying your bills. During the first month, your heart rate may go up when you see the total, but remember things will get better. Over time, the money in this section of the spreadsheet should increase as your total bills decrease. Enter your total income, then subtract the money spent on the bills; you will now have a clear picture of what is left to save and spend on the things you need.

2. Track what you spend!

Have you ever opened your empty wallet and wondered where all your money went? It happens to everyone at some point and as long as you’re not the victim of pickpocketing, or have sneaky kids who stole money from you for lunch, tracking your spending is easy… yes, you have it, another spreadsheet! For this spreadsheet, you just need to create columns with spending categories such as groceries, gas, restaurant dining, home decor, entertainment and all the other things your household spends on the money. After you’ve created your categories, be honest with yourself and start keeping a running total of what you spend on each for the month. At the end of the month, some of the totals can be alarming and you will get a glimpse of where you need to cut back ($ 200 spent on espressos, yikes!). For a fun family challenge, see if you can spend less in each category the following month!

3. Dig to save!

Manufacturers distribute millions of dollars in coupons each year for consumers to search for and find them. Coupons can save you a lot of money on the products you buy and further extend your monthly spending budget. If you can save an average of 50 cents a day by using coupons for the products you buy, that works out to $ 182.50 in your wallet over an entire year! You don’t have to make an entire career with coupons, as you see on TV, but small savings here and there will make a lot of money over time.

4. Use money, not plastic!

Staying on a budget means using only the money you have for spending. Credit card debt is one of the main financial problems facing Americans because it is easy to withdraw a card to buy something that you could not otherwise afford. It’s time to put away your credit cards and use them only in an emergency. To make it easier to keep track of your money, create envelopes for the items you need to buy and fill each envelope accordingly. If there is extra money in the envelope after making your monthly purchases, that money can then be transferred to a fund you may have failed on, or you can put it aside!

5. Understand your wants and needs.

A “need” is something that you must have to function in life. Food, sanitary supplies, proper clothing, and transportation are all considered to be things you need. A “desire” is something you wish to have, but your life will not be changed dramatically if you do not have it. If you simply can’t afford to have the latest cell phone model, designer handbag, or high-end clothing, then these items can go on your wish list and you can save to buy them at a later date. When trying to live on a budget, it is important to know the difference between wants and needs.