5 minute budget - Simple steps for organizing your financial life

A good budget lies at the foundation of every successful financial plan. A budget will help you prioritize your spending and stay within your means. Although a solid budget and spending is vital to a successful financial future, many consumers admit to not having one. According to a national survey conducted by the National Foundation for Credit Counseling, over 50 percent of Americans do not use a budget to monitor their expenses.

Developing a sound financial budget is something every household should do. To help you get started, the experts at Money Management International (MMI) offer the following advice:

Commit to change. The first thing is to examine your attitude about money and your relationship with spending. Make a firm commitment to change your money management behavior. Visit www.financialliteracymonth.com  and take the pledge to take steps to better your financial well-being.

Keep it simple. A budget should include both monthly and daily expenditures. Make a list of all fixed monthly expenses such as rent/mortgage, auto loan payments, etc. Then make a daily list of everything else you spend your money on. Include everything from your daily cup of coffee to gas for your car. This will help you monitor and control your spending.

Creating and maintaining a budget is that simple – it’s a matter of creating a plan for your spending and staying committed to that plan. There are many other things you can do to stay organized and simplify your financial life, but two very important steps include:

Track your spending. Carry a pocket size notebook and track every penny you spend for a month or two--from the packs of gum to vending machine snacks to lottery tickets. At the end of the month, examine your spending and determine which areas can be cut back to create surplus. You’ll be surprised to see how much money is being spent on items that could be easily sacrificed.