One of the seven money habits I often talk about is simply “Make a Plan for Your Money.” It’s so basic, but so many people don’t do it on a regular basis.

Another way of saying this — and hang with me here — is you need to make a budget. I know what you’re thinking. Budgeting is so boring! I get that. But, honestly, budgeting gets a bad rap.

I’m as much of a free spirit as anyone, so I understand that the thought of sitting down and talking about bills and expenses might sound a little dull. I also understand how a budget might seem very restrictive.

But here’s a secret about budgeting: Creating a budget will actually give you freedom with your money. It gives you permission to spend!

It’s one of the amazing principles about money I discuss in my book, Love Your Life, Not Theirs. 

When you know where every dollar is going, you’re prepared. You know what’s coming in and what’s going out.

When most people start budgeting, they feel like they got a raise. They suddenly “find” money they didn’t realize was there.

One great result of this is you’ll be able to start spending without guilt. All your money is accounted for, so you don’t have to worry whether or not your bank account will cover your purchase.

No matter what you’ve heard, I promise that making a budget isn’t difficult. First, simply list your monthly household income before the month begins. Next, list all your monthly expenses.

This should include all your bills, like rent, utilities, basic clothing needs and food, as well as your groceries, eating out, shopping, saving — everything!

Finally, subtract all your expenses from your income. If you’ve assigned every dollar a name, you should have zero. This is a simple zero-based budget.

When you’re making your budget, I recommend using a free app called EveryDollar. It’s the best budgeting app out there.

It will help you create a plan for your money, while making it easy stay on top of your budget throughout the month.

Don’t get discouraged if you mess up a few times. You might need three or four months to get your budget the way you want it.

But once you have a plan in place, you’ll be amazed at how much more in control you feel about your money.

You’ll experience more freedom, less anxiety and a better all-around understanding of your financial situation.

Here’s my challenge to you: If you’re not living on a monthly budget, give it a try.

I bet you’ll see a big difference, and you’ll never go back to a budget-less life again!

 

RACHEL CRUZE (www.rachelcruze.com) helps people learn the proper ways to handle money and stay out of debt. She’s written three best-selling books. Her column is used with permission from DaveRamsey.com, through which The Post-Intelligencer receives Ramsey’s column, “Dave Says.”

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