Budget Web Hosting

Check out this great site to find budget web hosting for your web site. There are some great deals here that can really save you money.

Budgeting College Expenses

Tips and Guides for the Upcoming 2007-08 College Year

College students are getting ready for the upcoming 2007 Fall semester. It is just a few weeks away before millions of student across the country make their trek to their university of choice.

Several tasks are required to prepare for that journey. Your first important task is calculating the exact costs for attending school. Colleges are required to provide estimated costs upon acceptance at the University. Those costs are estimated costs incur by students from previous years, adjusted for inflation. However, you should budget the amount of financial aid you will need for the academic year. You need to have a spending plan by month to avoid running out of money before the school year ends.

The costs that you should estimate include the following:

1. School Tuition and Fees:

   Costs to attend class instruction and the use of facilities, labs, libraries and all other related services for each enrolled student. And don't forget to add access fees to campus facilities. Check your class registration for what you will need.
   

2. Books and Supplies:
   

   The estimated cost for books and supplies the student will be required for classroom instruction. Many students fail to estimate the total cost for books and supplies; some classroom instructions may require several books and copied outlines. Make sure you estimate everything that you will need for each classroom.
   

3. Computer and Other Electronics:
   

   Not necessarily required for some colleges since they offer computer labs and other shared facilities. However, it will be the student's advantage to have their own personal laptop. Personal laptops can cost you $1,000 or more for a decent model. And then there is the software, printing, scanning, etc. Understand what you will need for each classroom.
   

4. Room and Board:
   

   The estimated cost for housing and food if you live in a residence hall; if you live off campus, the cost for monthly rent, utilities, and food. You need to estimate costs for eating in the cafeteria and other related snacks and beverages.
   

5. Transportation:
   

   The estimated cost for 2-3 round trips from your home to school (you don't want to spend the winter holidays at school). Additionally, what is going to be your transportation options at school? If you have your personal auto or other motor vehicle, estimate costs for fuel, insurance, parking fees, maintenance, and other related fees. If you are on foot or bicycle, estimate the costs for public transportation.
   

6. Personal Living Expenses:
   

   The estimated cost for clothing, grooming supplies, laundry and entertainment. Toothpaste, make-up, shampoo, deodorant, etc., can all add up.
   

7. Other Personal Costs:
   

   Personal expenses that are specific to the student such as insurance, disability expenses, dependent care, loan fees, etc.
   

8. Miscellaneous:

   Any other expenses that you can identify with your school's Financial Aid Office

You can estimate and budget these expenses by month using our FREE college budgeting worksheet. Link to our budgeting module for our guide and worksheet.

Private student loans are a great resource when you need extra money. Sometimes your college and personal aid will not cover the full cost of education after your run your budgeting analysis. That is when you turn to private student loans to make up the difference from the cost of education and the amount of student financial aid that you have. See more information about private student loans

copyright 2007 all rights reserved www.SayStudent.com

Krayton M Davis is the Executive Principal of nBuy Associates, which owns and operates the SayStudent College Financing Guide. For more information about our services, link to: http://www.SayStudent.com

Small Business Budgeting Tips - Perfecting the Plan That Keeps You On-Track

At the end of every fiscal year companies tallying up their scores to see how they’ve finished. Unlike the game of golf having the highest score is cause for celebration, being in the black you’ve done well and deserve some congratulations. If there isn’t a soirée going on in your business maybe it’s because you didn’t plan for a year-end party, and that could be the direct result of your failure to budget.

To be successful in business, budget cannot be a taboo word in your company. One of the skill sets you as an owner or manager need to possess is the ability to plan ahead, this includes that ability to budget. If you’re a visionary and lack budgeting skills, then stop reading and go find someone who is. So before we discuss budgeting tips, let’s first discuss what a budget is and isn’t.

What a Budget Is:

A budget is a proposed plan to monitor financial activity over a period of time. A budget is a planning tool an owner and/or manager should be using to measure trends over a fixed interval; this includes inflow, outflow, and asset/ liability growth. Finally a budget is a resource to forecast an assumed outcome.

What a Budget is NOT:

A budget is not the law; it is not to be used as a means of accountability and to ensure financial integrity. A budget is not to be used a ceiling to spending, and a method of absolute control. And finally a budget is not a guarantee so financial and business success.

So now that we have defined what a budget is, let us get to how to properly use and understand how a budget actually benefits a company.

The budget should be put together and approved at least 1-2 months prior to the start of the new fiscal year. This will allow for key employees to look at what the company is trying to accomplish and what is being aimed for. So for this to happen planning will need to take place approximately 3-6 months before the start of the new fiscal year, this of course depends on the complexity and size of the company.

The budget should reflect the direction that the company is headed in; this of course is handed down by the CEO and/or Board of Directors. Everything about the budget should point towards the strategic plan the company has adopted. The budget should also be multifaceted, not only should you include a Profit & Loss operating budget, but also a Balance Sheet budget to help track cash inflows and outflows.

Finally the budget should be realistic. An exponential increase in revenues without any foundational proof or purpose can lead to fiscal year failure. Again remember the budget is for mapping out trends in an attempt to forecast growth or decline. All the pieces must fit, in business there is usually a cause for increased revenues (hint: check for the reason in your expenses section!).

To summarize let’s recap the key points:

1. Budget is not taboo
2. Budget is a proposed plan
3. Budget is not the law
4. Approval should allow for time to disseminate throughout the company
5. Reflects the strategic plan and heading of the company
6. The budget should be realistic, for all growth there should be a reason

Jayson Cardwell is the Founder and CEO of Cardwell Financial Group, Inc. a small and mid-size business services and consultancy. Cardwell Financial Group, Inc. specializes in helping owners, managers, and entrepreneurs realize their dreams of owning prosperous and successful firms. They accomplish this by providing Financial Management, Analysis, Strategic Planning, Business Analysis, Executive Development, and Accounting Services and Consulting. For more information about Cardwell Financial Group, Inc and how they can help you visit them on the web at http://www.CardwellFinancial.com, or e-mail them at Info@CardwellFinancial.com

Tire Discounts

The booming Tire Discount industry has led to the mushrooming of Discount Tire Stores throughout the United States. While most of these stores sell tires directly to the customer, some are selling them via the Internet. Discount Tire Companies have come to represent an option that is affordable and can cater to various automobile requirements at economical rates.

Tire Discount Stores offer a range of tires to suit the varying needs of customers. In addition, they also offer tips and suggestions about making a good purchase, or tire maintenance. Some of these stores have also launched marketing drives to target potential customers. Some of the promotion initiatives include freebies like free mounting, coupons, or free servicing after a specified number of miles. Most of these Discount Tire Stores are located at advantageous positions, adjacent to highways and major roads, in order to give customers easy access.

Most Tire Discount Companies undertake various forms of research and development activities. This is to ensure safety, traction, reliability , durability, and any number of other factors that make for the perfect discount tire. These companies are aware of the vehicular requirements for tires, such as the speed index of the tires and the rating for load. These should not be lower than your original set of tires that came with your vehicle. The speed index indicates the safe top speed of the tire, and needs to be taken seriously. Generally, a decreased speed rating means that the tire’s ability to contribute the overall performance of the automobile is reduced.

Tire Discounts provides detailed information on discount tires, discount ATV tires, discount motorcycle tires, discount tire company and more. Discount Tires is affiliated with Used Race Car Parts.

Personal Budgeting Tough Love

Developing and living by a personal 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 personal 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 household 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 personal 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 household 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 personal budgets.

Finally, if you find you just can’t seem to stick to your household 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 budgeting 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 simply 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 personaly.

Here's another good answer. Try Mvelopes Personal. Mvelopes is the modern version of the paper envelope technique. This is what I personally use and it works great. Visit Mvelopes.com

TOP THREE CAUSES OF BUDGET FAILURE

Many people make an honest attempt to budget, but become discouraged and give up before they are able to accomplish any significant financial gain. The top three causes of budget failure come into play before you even begin to set up your budget. Awareness of these budget busters, is your first line of defense in the Battle of the Budget.

Budget Failure #1 - Negative Attitude It cannot be emphasized enough--a positive attitude about budgeting is essential to your success. If you think of budgeting in negative terms (such as a financial diet, financial handcuffs, restrictive, penny-pinching, a sacrifice, etc.), you are sure to fail, unless you are a martyr or a masochist who finds some strange reward in a punishing experience. For purposes of this article, we will assume that you are neither. A positive attitude means you think of a budget as a means to an end--a way to achieve your dreams and goals--and that postponing the instant gratification of spending all the money you earn is worth the rewards you will earn in the end.

Budget Failure #2 - Lack of Motivation What is your motivation for budgeting? Are you trying to appease a nagging spouse? Following the terms of a debt repayment plan with a consumer credit counseling agency? Complying with an agreement made in bankruptcy court? These are not bad motivations, but they are external pressures and will probably not be easy to maintain over time. The best motivations are internally generated: do you honestly believe that budgeting can help you meet your goals? If you need a little help in the motivation department, see "Twelve Reasons Budgeting Can Improve Your Life". A quick re-read of these will surely inspire and ignite a motivational spark or two!

Budget Failure # 3 - Unrealistic Expectations What do you expect to gain from instituting and following a budget? Do you think that setting up a budget will reveal large caches of hidden cash or that the budget fairy will sprinkle fairy dust over your budget and magically transform your spending habits after a month or two of tracking expenses? The reality is that budgeting is an endurance event--those who stick with it, through thick and thin, will come out ahead financially. Do not expect miracles. What you WILL see if you stick with it is steady, measurable progress towards the goals that really matter to you.

Starting a budget without having a positive attitude, internal motivation, and realistic expectations, will probably set you up for failure. You can greatly increase your chances of success by ruling out the three biggest budget busters before you even begin. Family budgeting – just the thought of it makes most of us cringe. However, mostly, we do attempt to curb our spending and live within our means. Others fall into bad habits, habitual spending patterns or impulse shopping and over-extend themselves, landing knee-deep in debt! Ironically, one of the first remedies for any debt consolidation or repair strategy, is to take a long hard look at the budget and financial patterns within the household! It is almost like running a diagnostic. To take a closer look, you are in effect placing your family dollars under a magnifying glass and microscope. This can prove both challenging and painful for most people. We hope to alleviate some of that initial discomfort and apprehension with this handy step-by-step guide and tips. Most financial advisors will tell you that you have to reward yourself for good fiscal responsibility, discipline and habits, to increase your motivation and success levels.

Budgeting is the first step, sticking with and to it, a close second and the sometimes overlooked but ever-important reward, has to keep the motivation going! To repeat and continue to experience the benefit of the budgeting cycle and discipline could be an uphill battle, but there are calmer seas ahead.

Cash management, savings, planning for retirement, setting financial goals etc. active and hands-on, is becoming increasingly important for the survival and well-being of our families everywhere. Be your own best expert with coming up with new ideas on how to save money, budget better and spend less! Your unique strategies stem from a deep understanding of your own situation, demands, and needs. Discover which tips and ideas work best for you. After all, fiscal management and finances are definitely not a one-size-fits-all solution environment. It is personal, customized and unique.

Why You Should Start a Family Budget

12 Great Resons Why You Should Start Budgeting Now For Your Family And Yourself

THE RATIONALE AND PROCESS OF FAMILY BUDGETING

Here are twelve good reasons to get you started:

1. Family budgets are used as a baseline, analysis-tool and roadmap. It is a useful tool. It tells you whether you are headed in the direction you want to be headed in financially. It helps you to move from spending to saving and good fiscal balance, management and responsibility. You may have goals and dreams, but if you do not set up guidelines for reaching them and you do not measure your progress, you may end up going so far in the wrong direction you can never make it back.

2. It is often described and justified as an empowering enabler. A budget lets you control your money instead of your money controlling you.

3. A family budget is a realistic estimate and true reflection of current circumstance and means, a type of financial situation-analysis that will tell you if you are living within your means. Before the widespread use of credit cards, you could tell if you were living within your means because you had money left over after paying all your bills.

There are lots of family budgeting tools available on line that make it a fun and enjoyable task and activity, to assess and analyze your family’s financial situation with minimum effort. There is also lots of free financial software and most of it sets up easily and provides you with a detailed family budget online. It manages your finances, hassle-free and almost effortless. Well, almost! It will require input and minimum effort through hands-on involvement in setting it up, populating, maintaining and editing it. Mvelopes.com is a good example of market offerings that are available at no cost to you, just waiting for the motivated family budgeter to embrace and try it out! Some websites offer free financial newsletters by e-mail, with lots of money saving tips, budget advice, and other relevant personal and family-related financial information. The availability, accessibility, virtual marketplace, ease of use and more of credit cards has made the need for family budgets much less obvious. Many people do not even realize they are living far beyond their means until they are knee deep in debt, struggling to make ends meet and sinking fast into murky financial waters. Budgeting for your family can be a life and money saver, a reality check, BUT ALSO a remedy!

4. A family budget can help you meet your savings goals. It includes a mechanism for setting aside money for savings and investments.

5. Following a realistic budget frees up spare cash so you can use your money on the things that really matter to you instead of frittering it away on things you do not even remember buying.

6. A family budget helps your entire family focus on common goals. It is unifying families in mutual purpose and effort, working together towards a successful outcome and reward.

7. A budget for your family helps you prepare for emergencies or large or unanticipated expenses that might otherwise knock you for a loop financially.

8. A personal budget can improve your marriage. A good budget is not just a spending plan; it is a communication tool. Done right, a budget can bring the two of you closer together as you identify and work towards common goals and reduce arguments about money.

9. A budget reveals areas where you are spending too much money, so you can refocus on your most important goals.

10. A budget can keep you out of debt or help you get out of debt.

11. A budget actually creates extra money for you to do use on things that matter to you.

12. A budget helps you sleep better at night because you do not lie awake worrying about how you are going to make ends meet. Nevertheless, despite all these wonderful reasons quoted above, people are still hesitant to commit to family budgeting as standard practice in their households.

About Author For More Great Information, And useful Tips On Creating A Winning Family Budget Or Even Improving Your Existing Budget visit http://www.family-financial-success.com

6 Critical Benefits of Preparing Your Own Personal Budget

The role of a personal budget is to help you manage your personal finances and eventually become free of debt. This is the dream of us all, isn't it? Most people shy away from doing the personal budget thing, but it is the best, most trusted and proven method for getting your personal finances in order. You can have your own personal budget completed within a couple of hours.

The task of preparing your own personal budget is a liberating experience. You can finally see the true state of your own finances. The benefits listed below will help encourage you in making your decision to start today.

Benefit #1. The personal budget focuses your thinking.

Without a personal budget you are not able to clearly see the extent of your spending compared to your income. This is the most important role of your personal budget. It will show you whether you are living within your means or whether you are living on borrowed funds. It is also the tool that can show you where all your money is being spent. This allows you to answer important questions, such as "Am I wasting money on things I don't really need?", "Is my credit card debt to blame?" and "How much better off would I be if I could manage to be free of debt?".

Benefit #2. A personal budget helps you save money and set goals.

Once you have correctly prepared your personal budget, it will show you how much you need to save from your income to meet your expenses and set aside some funds for emergencies. It allows you to set goals, both for the amount and the timing. For example, you may set a goal of paying $2,000 off your credit cards, within 1 year. Once you make a commitment to yourself to make this work the budget becomes a tool that will help you stay on track.

Benefit #3. Keeps your goals in your mind.

It is easy to slip back into your old spending ways if you do not commit to making your personal budget work. The budget will help you keep the goals you set in your mind when you are tempted to give in. When you are out, it can help you say no to frivolous expenditure, say no to that daily coffee-shop coffee, think twice before you hand over your hard-earned money on things you don't really need and wait until that item you really want goes on sale.

Benefit #4. A budget helps you live within your means.

Every time you make a spending decision, it has a positive or negative impact on your personal financial position. The budget can show you clearly how your spending habits affect your finances in advance. Your personal budget can help you understand that if you spend money on this item you can't use the same money to spend on something else. You only have a finite income. If you spend more than you earn you are living on borrowed money and the cost of that money is interest. The interest on borrowed funds is most probably the cause of your financial worries.

Benefit #5. Puts you in control of your finances.

If you've prepared your personal budget correctly, you will see how much you have available to spend, after taking into account your debt repayments and savings requirements for your future needs. This information can take away the guilt you may have felt when purchasing some item(s) you knew you couldn't really afford. When you know you can afford an item you really want, the purchasing experience will be much more enjoyable and rewarding.

Benefit #6. - Tracks your progress toward your goals.

Once you prepare you budget it should not put into a drawer and forgotten. It should be a live document that you refer to weekly, or at least monthly. This is your guide to your own financial freedom. You need to check your progress towards your goals, thus giving you the incentive to keep going and achieve your financial objectives. If you make the effort and follow your plan, you'll be surprised how easy it really is to reach financial freedom.

About Author
Bruce Hokin has designed a simple budget tool called "5 Steps to Freedom Personal Budget." It based on his extensive background as a qualified, experienced accountant, manager, consultant and financial adviser. You can download this powerful budget assistant today and be on your way to financial freedom within the hour. You can also click here for your FREE Mini-Budget.

Debt and Debtor's Disease - Do You Have It?

Debtor's disease is a silent killer. Killer of respect, marriages, self control, and families. There isn't a part of your life that it won't touch and destroy with it's deadly power. Some of you won't even know you have it for many, many years. It's a sneaky affliction; creeping into your life and slowly but surely taking control of every part of your existence.

Seems a bit of a dramatic description, doesn't it? But, the sad part is, it's all true. Even though we often hate to admit it, debt will control our lives totally. Even when we first realize it, we won't do anything about it. We will deny it, continue to feed it, and give it all it needs to thrive within our lives. Oh, you'll have help, no doubt about that. There are many ways we fuel the fever. Falling into the credit card trap is just the beginning. Self justification is your worst enemy. Why, the human mind is masterful at justifying just about any action, or purchase, given the right circumstances.

The first step is recognizing the disease. Diagnoses of debtor's disease is much harder than you might expect. Oh, the symptoms are very clear for sure. But, since most of us hate to admit our own vulnerabilities and defeat, they can be nearly invisible to the victim. I experienced nearly all of the symptoms below before I finally excepted the fact that I did indeed have the affliction. It is quite a humiliating experience to realize that so many obvious warning signs were present and you continued down the wrong path.

They say hindsight is 20/20; Meaning that the past is clearer when we look back. And, when things go wrong, we like to hope that we would have done things differently if we knew what we know now. Well, I'm hoping I can prevent you from some of that humiliation and financial disaster. You can stop it from growing to destructive levels if you can identify the warnings early on. Identify problems early and fix them. Make no mistake, if the following scenarios apply to your situation, you are headed for financial trouble.

SYMPTOMS
* Requesting credit increases lately?
Requesting credit increases for no specific major purchase, but because your cards are maxed out, is a sure sign that your spending is out of control. You may be living way beyond your income.

* Do you apply for new credit cards because your current credit balances are maxed out?
This is just another way to get additional credit especially, when you can't seem to get any more credit increases from your existing creditors.

* Are you rescheduling monthly bill payments due to lack of funds. If you find it increasingly difficult to pay bills on time and according to a consistent schedule, you're probably starting to get into trouble. You should not have to put off paying essential bills.

* Are you using credit to meet your living expenses.
Credit is not intended to help you live above your income. You should be able to meet all of your essential living expenses with your income. If you have income left for non-essential expenses, great. If not, don't turn to credit to live above your income. It will most certainly result in financial disaster.

Paying essential monthly bills, such as the electric or phone, with credit cards is a serious symptom. Once you turn to credit to pay your monthly bills, you're in serious trouble. Sooner or later the credit cards will be maxed out, you will be refused additional credit increases, and you won't be able to pay those bills.

* Do your credit card payments equal more than 10 -15% of your monthly income?
Your income to credit ratio is an important part of your credit management picture. The higher your balances, without an increase in income, the lower your credit score. This is true even if you have no derogatory items on your credit history, and are consistently maintaining good payment records.

In most cases, creditors will identify debtor's disease long before the victim realizes his affliction. They will begin to arm themselves against the consequences of the infection when this occurs. Your interest rates and penalties (i.e. late fees, over limit fees) may increase as companies anticipate default. Even they can see you're headed for trouble.

THE CURE

If you answered yes to any or all of the above, you have fallen victim to debtor's disease. Don't let it take control of your life! Fix the problems now. You'll have less stress and be a lot happier. I can say that with confidence. It is such a relief to be able to see an end to the struggle. You will feel as though a great burden has been taken from you when your finances are under control.

And, even though you may experience some difficult periods when you may get discouraged, you'll find those times much less stressful that periods when you worried about how your bills would get paid. Take some serious money management steps to begin your treatment. It's never too late to take control of your finances and make a commitment to debt free living.

* Identify overspending and eliminate it.

Identify where your money goes. Track spending for specified period of time. Eliminate unnecessary expenses. Reduce those you feel you need to keep.

* Develop a plan to become debt free.
Create a plan to get rid of debt. Use a self help plan or a professional. Whether you choose a counselor, debt consolidation or settlement, or a self help plan, lower debt consistently to manage and eliminate debt. A plan that calls for a consistent monthly commitment until debt is paid will be easier to budget.

* Create a Household budget

Creating a household budget will be essential to your success. It is necessary to bring your living expenses within your income. This is the concept of living within your means. You can create this yourself as well or seek professional help in setting up or maintaining your budget. Your situation and your level of self discipline will determine what will be most successful for you. Find a plan that works for your situation and will be the easiest for you to stick to!

* Implement lifestyle changes that will help you free up money to help pay down debt.
Consistently apply these extra funds to debt payments to get out of debt faster. The sooner you are free from debt, the sooner you can start investing that money in yourself. Save money everyday on everything you buy and do.

Once you rid yourself of debt, commit to debt free living. Remember, you now know how you made the mistakes, you know how to identify the symptoms, and you have the knowledge and power to implement the cure. You should now be immune to debtor's disease.

Now, you can vaccinate your children, friends, and family with the knowledge to prevent them from falling prey to this life draining affliction. Give them your hind sight and help them build happy, secure, and independent futures for themselves and their families.

Cheryl Johnson is on a mission to become debt free. As publisher of Simple Debt Free Living at http://www.simpledebtfreeliving.com she hopes to guide and encourage others to become and remain debt free through household budgeting, debt management, and money saving tips.

Planning A Budget for Life

Budget planning is directly related to planning life. You have hopes, dreams, and goals. The fact is that, most likely, you'll need some money to achieve your life goals. It benefits you to take hold of your future and manage your money for life; Not just for living, but for planning the fulfillment of your dreams and goals. Planning a budget is crucial for your future success in life.

Not only is budgeting a must to reach your life long goals, it's an essential lesson for your children. A life survival lesson you might say. Budgeting is necessary for financial survival. We all want our kids to grow up to be successful adults. Right? Start budgeting habits early on. Teach them how to plan a budget to build wealth and be financially independent. Children model behavior, both good and bad. Teaching good habits by example is always the best lesson. After all, if you practice what you preach, you reinforce the importance of the lesson.

When you start to create your budget plan, get your kids involved. Help them understand your finances, and how you manage money, to prepare them for managing their own. Explain how credit and debt work. Encourage good credit management skills. Giving your children a chance to see how budgeting works will give them a clearer understanding of money. Besides, it can be very helpful when you have to say no to that new bike. Creating a personal finance budget is a crucial step in planning for life. Planning for life means managing your living expenses and planning for the future.

Budgets come in many forms and should meet your individual needs. No matter how you choose to accomplish the task of budgeting, you'll need to know some essential budgeting information. You'll have to know how much you have to spend, how much money you actually do spend, total debts owed, and what your savings or investment goals are. Then, plan your budget for life. Control spending to free up money for funding emergency and investment savings. These will help you achieve goals for you and your family. Personal budget planning will help keep you focused on those life goals. Be a life planner and teach your kids to plan for life. Manage your money and your credit wisely. Don't let it manage you!

Budgeting: A Tough Love Way to Handle Your Household Budget

Some families find it difficult to stick to a household budget. The good news is that most people find the longer they can stick to a budget, the easier it becomes. But how do you get through those tough first two, three or four months? This article describes things you can do that will help make sticking to a budget easier, including one "tough love" solution ...

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 category.

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

19 Ways for Couples to Stop Fighting Over Money

1. HAVE GUIDELINES. Marriage is a partnership so both partners must participate and mutually agree on financial guidelines and budget making.

2. NEGOTIATE. Nothing is set in stone. Your budget and spending guidelines should change just as your lives do. Both partners can negotiate and renegotiate when necessary.

3. KNOW THE DIFFERENCE. Wants and needs are two very different things. Make sure the family needs are taken care of before entertaining the thought of spending on each others wants.

4. DON’T TURN ON YOUR SPOUSE. Your spouse is your partner. When times get rough you and your partner must band together to develop a plan of attack.

5. MAINTAIN INDEPENDENCE. Yes, a marriage is a partnership, however this does not mean that each person must lose their financial independence. Agree on a spending amount or ‘allowance’ for each person. The allowance is used as personal spending of their choice.

6. DON’T HIDE IT. Don’t hide the money (income or spending) from your spouse. Trust plays a major role in successful relationships. If you have negotiated a budget that you both are abiding by there should be no reason to hide finances.

7. DON’T SPEND IT IF YOU DON’T HAVE IT. If you don’t have the money at the time you are purchasing it…chances are you can’t afford it.

8. TALK ABOUT IT. Talk about buying big-ticket items. These sorts of purchases impede on guidelines so they too should be agreed upon before spending the money.

9. BE REALISTIC. Fully understand your budget. Know how much your family income is and what your expenses are. Create your budget based on real numbers.

10. DON’T RENEG ON YOUR AGREEMENT. Once you have agreed to something follow the agreement. Breaking it will result in lost trust, frustration and feelings being disrespected.

11. BEWARE OF ‘WHEN’ THINKING. Don’t get caught in ‘when’ thinking – “I’ll pay this off when I get my next pay.” Most of us are guilty of doing this at one point and many of us have realized that ‘when’ never arrives. Usually the money you thought could be used to pay for your purchase has already been allocated towards the budget.

12. KEEP TRACK OF SPENDING. Write down each financial transaction your make, groceries, bill payment, gas, entertainment etc. Visually seeing spending habits will help identify areas where money is being wasted. Note: online banking is a great way to keep track of your spending

13. DON’T BE DRIVEN BY EMOTION. Don’t spend for the emotional high of it. Understand what drives you to spend and realize that careless spending can cause bigger emotional stress. Remember, emotional problems will not be solved with money.

14. BE INFORMED. Educating yourself is crucial in helping make the best decisions possible. There are many laws and incentives impacting your finances that many problems can be avoided if both individuals had the knowledge they needed to make better decisions.

15. FIGHT FAIRLY. Do not use money as a weapon to attack your partner.

16. DECIDE ON YOUR ACCOUNTS. Joint or not to joint…that is the question. Couples have come to many different arrangements when it comes to this. Whether you keep separate accounts, a joint account or both separate and joint accounts it doesn’t matter, just as long as both people are happy with the arrangement.

17. REMEMBER YOU AGREED TO IT. Don’t be resentful if things don’t turn out the way you thought they would. Remember, you agreed to it.

18. USE A SYSTEM FOR BILLS. Who should pay household bills should be discussed. Whether it’s one partner who takes on the responsibility or both people choose to pay them, make sure that there is a system in place for bill paying.

19. REFLECT BEFORE REACTING. Many times relationship problems mask themselves as financially motivated issues. Before reacting to problems that seem to be financial, ask yourself what the root of the problem really is.

By Gina Goldenberg BA, Cert. Ed. -Mess Management http://www.messmanagement.com FREE Mess Management Idea-Pak and E-zine, filled with tips and information articles to help you organize your home or office and simplify your life. Gina Goldenberg may be contacted at http://www.messmanagement.com or info@messmanagement.com

Debtor's Disease - Do You Have It?

Debtor's disease is a silent killer. Killer of respect, marriages, self control, and families. There isn't a part of your life that it won't touch and destroy with it's deadly power. Some of you won't even know you have it for many, many years. It's a sneaky affliction; creeping into your life and slowly but surely taking control of every part of your existence.

Seems a bit of a dramatic description, doesn't it? But, the sad part is, it's all true. Even though we often hate to admit it, debt will control our lives totally. Even when we first realize it, we won't do anything about it. We will deny it, continue to feed it, and give it all it needs to thrive within our lives. Oh, you'll have help, no doubt about that. There are many ways we fuel the fever. Falling into the credit card trap is just the beginning. Self justification is your worst enemy. Why, the human mind is masterful at justifying just about any action, or purchase, given the right circumstances.

The first step is recognizing the disease. Diagnoses of debtor's disease is much harder than you might expect. Oh, the symptoms are very clear for sure. But, since most of us hate to admit our own vulnerabilities and defeat, they can be nearly invisible to the victim. I experienced nearly all of the symptoms below before I finally excepted the fact that I did indeed have the affliction. It is quite a humiliating experience to realize that so many obvious warning signs were present and you continued down the wrong path.

They say hindsight is 20/20; Meaning that the past is clearer when we look back. And, when things go wrong, we like to hope that we would have done things differently if we knew what we know now. Well, I'm hoping I can prevent you from some of that humiliation and financial disaster. You can stop it from growing to destructive levels if you can identify the warnings early on. Identify problems early and fix them. Make no mistake, if the following scenarios apply to your situation, you are headed for financial trouble.

SYMPTOMS

• Requesting credit increases lately?
  Requesting credit increases for no specific major purchase, but because your cards are maxed out, is a sure sign that your spending is out of control. You may be living way beyond your income.


• Do you apply for new credit cards because your current credit balances are maxed out?
  This is just another way to get additional credit especially, when you can't seem to get any more credit increases from your existing creditors.


• Are you rescheduling monthly bill payments due to lack of funds. If you find it increasingly difficult to pay bills on time and according to a consistent schedule, you're probably starting to get into trouble. You should not have to put off paying essential bills.


• Are you using credit to meet your living expenses.
  Credit is not intended to help you live above your income. You should be able to meet all of your essential living expenses with your income. If you have income left for non-essential expenses, great. If not, don't turn to credit to live above your income. It will most certainly result in financial disaster.
  
  Paying essential monthly bills, such as the electric or phone, with credit cards is a serious symptom. Once you turn to credit to pay your monthly bills, you're in serious trouble. Sooner or later the credit cards will be maxed out, you will be refused additional credit increases, and you won't be able to pay those bills.


• Do your credit card payments equal more than 10 -15% of your monthly income?
  Your income to credit ratio is an important part of your credit management picture. The higher your balances, without an increase in income, the lower your credit score. This is true even if you have no derogatory items on your credit history, and are consistently maintaining good payment records.
  
  In most cases, creditors will identify debtor's disease long before the victim realizes his affliction. They will begin to arm themselves against the consequences of the infection when this occurs. Your interest rates and penalties (i.e. late fees, over limit fees) may increase as companies anticipate default. Even they can see you're headed for trouble.

THE CURE

If you answered yes to any or all of the above, you have fallen victim to debtor's disease. Don't let it take control of your life! Fix the problems now. You'll have less stress and be a lot happier. I can say that with confidence. It is such a relief to be able to see an end to the struggle. You will feel as though a great burden has been taken from you when your finances are under control.

And, even though you may experience some difficult periods when you may get discouraged, you'll find those times much less stressful that periods when you worried about how your bills would get paid. Take some serious money management steps to begin your treatment. It's never too late to take control of your finances and make a commitment to debt free living.

• Identify overspending and eliminate it.
  
  Identify where your money goes. Track spending for specified period of time. Eliminate unnecessary expenses. Reduce those you feel you need to keep.


• Develop a plan to become debt free.
  Create a plan to get rid of debt. Use a self help plan or a professional. Whether you choose a counselor, debt consolidation or settlement, or a self help plan, lower debt consistently to manage and eliminate debt. A plan that calls for a consistent monthly commitment until debt is paid will be easier to budget.


• Create a Household budget
  
  Creating a household budget will be essential to your success. It is necessary to bring your living expenses within your income. This is the concept of living within your means. You can create this yourself as well or seek professional help in setting up or maintaining your budget. Your situation and your level of self discipline will determine what will be most successful for you. Find a plan that works for your situation and will be the easiest for you to stick to!


• Implement lifestyle changes that will help you free up money to help pay down debt.
  Consistently apply these extra funds to debt payments to get out of debt faster. The sooner you are free from debt, the sooner you can start investing that money in yourself. Save money everyday on everything you buy and do.

Once you rid yourself of debt, commit to debt free living. Remember, you now know how you made the mistakes, you know how to identify the symptoms, and you have the knowledge and power to implement the cure. You should now be immune to debtor's disease.

Now, you can vaccinate your children, friends, and family with the knowledge to prevent them from falling prey to this life draining affliction. Give them your hind sight and help them build happy, secure, and independent futures for themselves and their families.

Author Resource: Cheryl Johnson is on a mission to become debt free. As publisher of SimpleDebtFreeLiving.com she hopes to guide and encourage others to live debt free through household budgeting, debt management, and money savings tips and strategies that save you money everyday and reduce living expenses.

Create and Maintain a Budget for Your Family's Financial Security

Create and Maintain a Budget

The first step to avoiding the troubles of financial debt is to create and maintain a budget. It’s not as intimidating as it sounds, don’t worry.

First off, create a list of all your monthly income and also a list of your monthly expenses. When determining income, list all sources including alimony, child support, side jobs, etc. In calculating expenses, be sure to include housing, food, transportation, utilities, entertainment, etc. To gain an accurate reflection of actual expenses, sit down each night and write down expenses, just make sure to save receipts. Determine if your income covers all of your expenses. If the answer is no, then some expenses need to be reduced.

Adjust expenses. If it is a small discrepancy, it may mean reducing some minor expenses like entertainment or cell phone plan. If the deficit is larger, you may need to downsize your vehicle or living arrangements. If your income covers all of your expenses, you still may want to trim some of the excess fat off your spending habits. This can free up extra money for things such as vacations or college funds for your children.

Additionally, consider if you need to add new categories. Some areas that are often overlooked are debt reduction, emergency savings funds, and retirement savings. An emergency fund ensures there is an adequate amount available to cover unforeseen events (car emergency, etc), should it arise. This will eliminate the need for using credit which can quickly damage your budget.

There are several advantages to sticking to your budget. Firstly, most people have set financial goals that they would like to reach in the future. Sometimes it may be a trip, a brand new car, or a college education. A budget can help people save money to make these goals a reality. Additionally, many people are crushed under heavy consumer debt. Without a disciplined pattern of spending, it is virtually impossible to make much headway in reducing debt. A personal budget will provide the necessary framework to begin eliminating these inflated account balances.

If executed properly, a budget will allow a person to simultaneously meet their expenses, place money into savings, and pay back outstanding debts. Therefore, it is anyone’s best interest to create and implement a budget.


By Janet Bullard - She may be contacted at http://www.magnoliawalker.com/index.html webmaster@magnoliawalker.com Click here to view more of Janet's articles.
Janet, a homeschooling parent, balances teaching, internet marketing and computer programming. She promotes various products at http://www.magnoliawalker.com/index.html. As part of her service to Christ, she is the webmaster for her church's webpage at http://greenland.magnoliawalker.com. In her spare time she gardens, paints, quilts, and goes trail riding on her Tennessee Walker. Go check out her site and sign up for her weekly newsletter at: http://www.magnoliawalker.com/subscribe.html You may also view her latest newsletter: Christian Pen Pal Newsletter at http://www.penpalezine.com

Your Credit Card Payment Just Doubled!

Even if you didn’t charge anything last month, your next payment may have just gone up

If you haven’t received your credit card bill yet this month, you may be in for a big surprise, especially if you went a little overboard with your holiday spending. For the estimated 40-million Americans who carry a balance on their credit cards their minimum payment may be increasing anywhere from 40-100 percent. Here’s a look at why, and what to do about it.

Under pressure from federal regulators, credit card issuers are increasing the minimum monthly payment requirement on outstanding balances. The change should help consumers in the long run, but can be painful in the short-term.

Credit card minimum monthly payments have traditionally been set at an average of 2 percent of the outstanding balance. The entire 2 percent would often go towards interest, and cover little or none of the principal. According to Bankrate.com, a balance of $8,000 (the approximate credit card debt carried by the average American) would take almost 54 years, and cost an additional $22,931.52 in interest when paying only the minimum 2 percent each month.

Credit card companies are now required to set a minimum monthly payment that covers interest, plus at least 1 percent of the outstanding principal. Using those guidelines, that same $8,000 would take only 30 years to pay off and cut your interest in half to $11,789.08.

Obviously 30 years is still a long time to pay off credit card debt. Most people will pay off their home loans in less time than that.

All too often, I see people treating their credit cards as an additional source of income. The key is to pay-off your balance each month.

According to a recent study by the American Bankers Association, less than half of cardholders consistently pay-off their balance each month.

The problem usually starts when we have an irregular expense, such as car maintenance, holiday spending, or a vacation. We turn to the credit card to cover the difference, planning to pay it off next month. But when next month rolls around our budget is tight again, and even if we don’t add to the balance, we’re unable to pay it off in full.

The trick is to manage your daily, weekly and monthly spending. Set up a spending plan based on your income and include regular expenses like mortgage, groceries and car payments, but also irregular expenses such as holidays, birthdays, car maintenance and medical expenses. By planning ahead and setting aside a little each month for these irregular expenses, you’ll have enough to cover them when they arise and won’t have to turn to the credit card to cover the difference.

Most people can easily squeeze an additional 10 percent out of their paycheck by simply creating a spending plan and tracking their expenses. Use an online budgeting tool to make setting up your spending plan simple. Mvelopes Personal offers a free 30-day trial. A pen and paper will work, but you have to be disciplined to stick with it long-term.

Credit card spending can throw an extra wrench in a budget. When you make a purchase on a credit card, the money isn’t immediately taken out of your account, as it is with a debit card. By the time the bill comes, you may have already spent the money elsewhere. A program like Mvelopes Personal, which has a credit card tracking feature that automatically sets aside the money from your budget whenever a purchase is made with a credit card, can make credit card spending less abstract.

Even if all you can do is pay the minimum, make sure that you at least do that. Ignoring the problem won’t make it go away. It’s expensive and will take a long time, but by paying at least the minimum each month, you’ll keep the credit scoring folks happy, which can save you thousands of dollars later on.

Steven B. Smith is the author of Money for Life: Budgeting Success and Financial Fitness in Just 12 Weeks! and President and CEO of In2M Corp. www.in2m.com.

9 Financial Resolutions

Earlier this week I wrote about "Nine New Year’s Resolutions to Get Your Finances in Order". Today I would like to expand on some of those ideas. Have your personal finances been a bit of a challenge this past year? According to In2M Corporation’s financial fitness survey conducted this past fall, you aren’t alone!

• Nearly 90 percent of survey respondents are moderately to very concerned about their ability to meet future financial obligations for major items, such as education and retirement.
• Seventy-three percent of respondents said their financial situation is about the same as (40 percent) or worse than (23 percent) when compared to last year.
• Sixty-six percent stated their approach to financial management is either reactive or simply total avoidance. Only a small 34 percent follow a plan of action.
  

Here are 9 suggestions that you may want to consider for this next year. Now is the time to get control of your finances, and take that first step down the path to financial fitness. Why not start this next year off on the right financial foot?

1. Spend less than you make.
Just like you can’t loose weight if you take in more calories than you burn… you can’t save money if you spend more than you bring in. Spending less than you make on a consistent basis is the key to reaching financial fitness and financial stability. You can’t increase your savings, make investments, reduce debt or even make wise spending decisions if you’re consistently overspending your income each month. Forty nine percent of respondents, to In2M’s financial fitness survey, said they rarely, if ever, use a budget to manage household spending. No wonder they have so many challenges with overspending, increasing debt and lack of savings.

Put together a spending plan and make it one that works for you and your family!

For a step-by-step process of how to make an effective spending plan, look in the book Money for Life and its companion piece the Money for Life Success Planner. These books walk you through the process and explain the reason behind each step, in a way that anyone can understand. If you’d rather go the paperless route, Mvelopes Personal will help you create an online spending plan.

2. Save more… at least 10% of your income.
Ever hear of the theory of paying yourself first? That’s basically what this is. If you make it a habit to pull out 10% for savings and investments for retirement, before you pay any other bills, you are actively working towards a better financial future for yourself. This 10% can include your 401k account if you have one, but be sure you are maximizing that option! It’s also wise to put an additional amount into savings after your 401k investment is made. Put this money into a money market account, money market fund or CD if possible, so that you get a higher interest rate. According to In2M’s financial fitness survey conducted this past fall, 48 percent of respondents saved nothing in the past 6 months and 31 percent saved less than 10 percent of their income. Don’t be one of the statistics, take action today and start saving!

3. Calculate your net worth.
Do a reality check to ensure you are on the right track. Your net worth should be increasing each year, even if it is just by a small amount. The exercise of calculating your net worth can be very valuable as well… people often discover accounts, investments, etc that they have forgotten about, or need to update.

If your net worth has decreased from the year before, take an honest candid look at where you can make adjustments to improve these numbers. Consider accelerated debt reduction. Consider increased savings. Even consider canceling every credit card you have if it means that you stop overspending and start saving. Be proactive in your efforts to get financially fit!

4. Start an emergency fund.
If you don’t already have an emergency fund, start one today! Your emergency fund should have a minimum of 3 months worth of expenses in it. This is your emergency money for a job loss, emergency repair, medical expense, etc. Keep these funds in a money market account or other high interest, easily accessible account. If ever you have the misfortune of an unexpected job loss, unexpected car repair, unexpected appliance problem… you will be far more prepared to weather the storm if you know you have a little breathing room on your finances, thanks to your emergency fund! That peace of mind makes all the difference.

5. Reduce your debt.
Use the debt roll down principle to quickly reduce your debt. Make a list of all your debts and prioritize them in order of interest (highest to lowest) or in order of the number of payments till payoff (fewest payments at the top). Once your first debt is paid off, roll that payment amount into the next debt on your list. Follow the same procedure when the second debt is paid off. You will not only reduce the number of years you will have payments, but you will also save thousands in interest if you follow this principle until you are completely debt free.

6. Use credit cards for the benefits, not the penalties.
If you use a credit card, only do so when you know that you already have the funds set aside to pay the balance completely when the bill arrives. Do not carry a balance on your card! It wastes money and ends up costing you a fortune in interest and finance charges. Thirty Eight percent of respondents to In2m’s Financial Fitness Survey stated that they never pay off their balance, and 33% only do so part of the time. Are those airline miles really worth it? Not if you aren’t paying the card off every month!

7. Make sure you have adequate insurance.
We’re talking home, life, disability, health, property and even auto. Not too many other things will matter if you have no fire insurance and your house burns down. Thirty Five percent of respondents to In2M’s Financial Fitness Survey stated that they either knew they had too little insurance or that they weren’t sure what their coverage was. Make sure that you, and your family, are covered adequately!

8. Create or update your estate plan and/or your will.
Whether you are single, married, divorced, kids or no kids… you need to have the proper documents to make your wishes known.

• Update your beneficiary info on your retirement accounts, insurance, etc.
• Specify money that you want to give to charity through a trust or gift exclusion.
• When preparing a will reference an addendum in the will where you list who will get your various assets and personal property.
• Make sure all language is clear and as specific as possible so that your wishes can be carried out.
  

9. Manage your portfolio.
If you have any 401k accounts from former employers, be sure you roll them over into an account that you control. Consolidation can also make your retirement accounts easier to manage, however, in doing so make sure you don’t jeopardize the diversification. Tools like Mportfolio, from the makers of Mvelopes Personal, can help you manage all your investment accounts from one spot, quickly and easily.

Take advantage of the New Year and get on the path to financial fitness!

Using the Envelope Budgeting Method in Today’s Cashless Society

Traditionally the envelope budgeting method used cash and actual paper envelopes; however, in today’s high-tech and often cashless society, that would be a little unrealistic. Some expenses simply cannot be paid in cash and, therefore, we need to find ways to use these tried and true principles of envelope budgeting, in today’s world.

The major problem with many budgeting systems has been that they provide after-the-fact information, meaning you create a plan in advance and determine the amount you will spend in each spending category. At the end of the month, you then run a report, which tells you all the categories in which you have overspent. With this approach, the information is not real time—in other words, you did not have the information you needed at the time you were making a purchase decision. Systems like this do not tell you how much is left to spend. An envelope budgeting system provides this critical information.

Even with the significant advantages of the envelope budgeting system, it is only as good as your determination to use it. Meticulous tracking will only prove successful if you are prepared to guide your spending decisions based on the information the envelope system is providing you.

Success will ultimately come from persistent and consistent execution of the success cycle and the envelope budgeting principles. Let’s quickly review the envelope method of budgeting:
¨ Set money aside in advance of spending requirements
¨ Spend from how much is left
¨ When you run out money, you must make a choice
¨ At the end of the period, what’s left is savings
Of course these steps above pre-suppose that you have made the commitment to spend less than you make. Without that, the envelope principles don’t work.

When you partner envelope budgeting with the success cycle, you will have a system that really works. The success cycle is made up of four steps:
¨ Plan
¨ Track
¨ Compare
¨ Adjust

Your Monthly Spending Plan is the part of the envelope method that coincides with the first step of the Success Cycle – Plan. Your Monthly Spending Plan has defined budget categories, or envelope spending accounts. The next step is to track all of your transactions so that you can compare that information with your plan. You will want to use your plan, along with your tracked transactions, to make informed spending decisions; if you know how much you have spent, how much you have left to spend and how long it has to last, you can make appropriate spending choices that won’t limit your options in the future.

How do you realistically track every transaction? Yes, It does seem daunting at first, but it’s actually not as hard as it sounds with the help of the right tools. The right tools can make this task simple, even automatic.

The most critical component to successful tracking is the proactive decision to actually do it. Once you have made this decision, you can begin reviewing the variety of implementation tools that are available to help you in your task; and then find the one that is right for you.

There are a variety of implementation tools available that you can use with the envelope budgeting method. Among the options are:
¨ Cash-based
¨ Paper-based
¨ Spreadsheet
¨ Software
¨ Online System
¨ Combination of the above

Choosing an envelope budgeting system.
Finding out which tool is right for you is important to ensure your long-term success. The correct implementation tool must assist you in successfully tracking all expenses and maintaining the balance information that is necessary to make informed spending decisions on a daily basis. Above I mentioned several types of tracking tools, lets review them in 4 basic categories:

1. Cash
2. Paper ledger or computer spreadsheet
3. Computer-based envelope system
4. Combination of these

Choosing the correct implementation tool for you and your family is a matter of personal preference and lifestyle.

Cash-based envelopes.
The most basic approach to implementing the envelope principles is using a cash-based system. Income allocation and tracking your spending are both very straightforward with cash. Because of these advantages, many people have opted to use the cash system. However, because it is more difficult and inconvenient to make all payments with cash, many people combine a cash-based envelope system with a system that can handle the management of non-cash transactions as well.

Tracking all of your spending is quite simple with a cash envelope system, as every transaction is automatically subtracted from the balance remaining in a particular spending envelope, or account. For example, when you make a clothing purchase, you take the clothing envelope with you and pay for the purchase from the clothing envelope. Let’s say you have $100 left in your clothing envelope, and you are making a $60 purchase. When you hand the cashier the $60, you will have $40 left in the envelope. Simply write down the transaction on your envelope or place the receipt in the envelope so that you can look back at where your money was spent during the month. When you count up the cash left in the envelope, you will know how much you have left to spend and how long it will need to last.

Paper ledger or computer spreadsheet.
Using a paper ledger or computer spreadsheet system allows you to track all types of spending. This approach works much the same way as the cash-based envelope system, with a few adjustments. Obviously, you will not be allocating actual cash to spending envelopes. However, you will be creating spending accounts that are essentially virtual envelopes. Your cash will stay in your bank account, but you will allocate it to your spending accounts for the purpose of tracking your spending and determining the balance remaining in each spending account on a daily basis.

If we use the same example used in the cash-based method above, with the paper-based system, you will need to record the non-cash spending transaction—that is, check, debit card, or other form of payment that you used to buy the $60.00 in clothes—in your bank account register, as well as in your clothing account register and subtract that amount from the $100 balance in the clothing account. The same would be true if you created an account register spreadsheet on the computer.

Computer-based envelope system.
Perhaps the easiest envelope system for most to use is a computer-based or online system. If you are using a fully automated envelope-based computer system, your transaction will be tracked automatically for you. For the example that was used above, you will simply need to download the non-cash transaction and assign it to your clothing spending account. The system will automatically update the balance remaining in that account for you. You will know exactly how much you have spent, how much you have left to spend and how long it needs to last.

In addition to the above, the right system will help you complete each of the following:
1. Create your monthly spending plan.
2. Set up your spending accounts.
3. Create your funding, or income allocation, plan.
4. Set your initial spending account balances.
5. Ensure your spending accounts and bank accounts are balanced.
6. Allocate your income to spending accounts as defined in your funding plan.
7. Automatically track your transactions.
8. Assign your transactions to the appropriate spending accounts.
9. Split transactions between a number of spending accounts.
10. Set aside money for credit card purchases.
11. Complete a monthly review and make adjustments.

An appropriate computer-based system also will generate a number of important reports, including spending and bank account summary reports. These reports can be printed on a daily basis and carried with you to assist with making sound spending decisions. It also should help facilitate the monthly reconciliation process for your financial institution accounts.

Using a combination of these approaches.
Even if you use a paper ledger system, computer spreadsheet, or computer-based envelope system, there may be certain spending accounts for which you would like to use cash. This is not a problem and can easily be done. Most people who use a combined approach use cash envelopes for many of their monthly discretionary accounts, such as groceries, entertainment, allowances, and clothing. They find they are able to exact a higher level of control over these spending areas when they are using cash. If you would like to use cash for some of your spending accounts, you will need to go to the bank or ATM once each month and take out enough cash to meet the funding, or income allocation, requirements for these envelopes.

It’s about choices, not restrictions.
One of the most often-cited objections to the idea of budgeting is the thought that budgets become restrictive and frustrating. The feeling that they cannot make purchases when they would like to can be very disconcerting for many people. However, in reality, as you spend beyond your income resources, your spending choices become increasingly more restricted. Real, long-lasting choice comes from making the decision to live within your means.

That said, there are many times when making a decision to spend beyond the current resources in a spending account is just fine. Let’s say that a desired clothing purchase was $125. You recall the balance in the clothing envelope is only $100. In this case, you have to decide if you would like to put off the purchase until you have more money in the clothing envelope, purchase a less expensive item, or transfer money from another envelope to cover the added cost.

As you can see, the information provided using the envelope system has truly empowered you to make an informed decision. Making the decision to transfer money from another envelope is not a problem, because by transferring the funds, you have made a decision to spend less in that area.

Now let’s say that you did not have extra money in another envelope to transfer to the clothing envelope. In this case, if you are truly dedicated to living within your means, your only option is to either purchase a less expensive item or wait until you have more money in the clothing envelope. Choosing to spend the extra $25 when the resources are not available will limit your choices in the future, because you have just created debt above and beyond your monthly net income resources. This means you will be paying more interest next month and further reducing available resources to purchase the things you want or, more importantly need.

Most people are very successful at making sound purchase decisions when they know how much is left to spend. But ultimately, your success in making smart decisions will depend on your resolve to live within your means.

Nine New Year’s Resolutions to Get Your Finances in Order

1. Automate your finances. If it’s not easy, most of us simply won’t do it. Make it easy on yourself by using a secure online budgeting system, like Mvelopes Personal, to track and categorize your expenses. Use online bill pay to save time and money.

2. Create a spending plan. Determine how much you plan on spending, and where you want to spend it. Give yourself some flexibility to allow for some of those impulse buys without ruining your overall plan. Spending management is simply proactively budgeting your money.

3. Save at least ten percent of your income. If you don’t pay yourself first, there won’t be any left over at the end of the month to save. Set up an automatic transfer to a savings account to make it easy.

4. Pay at least the minimum on your credit cards, and pay off all that you can. Making at least the minimum payment on time accounts for 35 percent of your credit score. Paying off the entire balance each month can save you hundreds in interest.

5. Contribute enough to your 401(k) to get the maximum company match. Your kids can get help to pay for college, but no one will help pay for your retirement. If you’re not taking advantage of a company match, you’re turning down a yearly bonus from your employer.

6. Review and readjust your portfolio. Make sure that no single stock comprises more than five percent of your portfolio. As your different investments perform differently, your distribution will become skewed. Readjust your holdings to match your desired distribution.

7. Start an emergency fund. You should have three to six months’ worth of expenses set aside in an easily accessible account to cover mortgage, food, car payments and other necessities in an emergency. Keep it separate from other funds to avoid spending it.

8. Check your credit reports. You’re entitled to one free copy of your credit report from each of the three credit-reporting agencies at your request. Stagger the reports, receiving one every four months to keep an up-to-date view of your credit throughout the year.

9. Review your insurance policies and update as needed. Review your life, health, home, auto and disability insurance policies. Make sure you have cost replacement coverage on home and auto insurance, as well as good liability coverage. Make sure your home insurance reflects the current value of your home.