How to Create a Budget that has me in it

They key to living well on a budget is prioritizing. By skipping the things that aren’t important or finding cheaper substitutes, you can have room in your budget for the little luxuries that mean a lot.

1. Find out where your money is going and you’ll be able to direct the flow. Get a rough idea of how much you spend on basic groceries, luxury foods, cleaning products, clothing, home improvement/home decor, entertainment, health, and anything else that makes up a large portion of your budget.

2. Optimize your grocery purchases. It’s not all about the math; buying the bigger bottle of catsup might be six cents an ounce cheaper on paper, but if you end up throwing away half the bottle, you may as well have bought the smaller one that was more expensive per ounce but cheaper over all. Plan meals carefully so you can use all of your ingredients instead of having leftovers that get thrown away. Buy house brands whenever you can do so without seriously compromising on quality.

3. Clean out your closet. Get rid of any clothing you seldom wear, and organize the items you wear most so that they are easier to find. When you can quickly find an appropriate outfit, you will never feel like you have “nothing to wear” and need new clothes.

4. Do as much as you can to get the rest of your house in order. Being able to find what you need will save you from having to duplicate things like tools, cleaning products, and office supplies.

5. Audit your monthly bills. If you don’t watch a lot of TV, maybe you can cut back to basic cable. Is your cell phone plan a good value? What about your landline? Do you even need both? Music memberships, online gaming subscriptions, and magazine subscriptions are other culprits. If you are not getting a lot of use and enjoyment out of these things, cancel them.

6. Avoid buying snacks from vending machines or eating fast food meals. Brown bagging it at work can save a substantial amount.

7. Tally up how much you will save with your new budget plan and congratulate yourself.

8. Decide what matters most to you. Of all the ways you could spend that money, which would make you happiest? Would you like to have more evenings out at a nice restaurant? Gourmet coffee instead of pre-ground, tasteless beans? Maybe you would like to take a class or participate in a sport. Your new budget should give you the freedom to do some of the things that matter. The best part is, you only sacrificed the things that don’t.