Source: Money Tips from Food For The Soul

Contributed by Natalia T.

BudgetI’ve tried many ways to stay on budget but they never seemed to work for me.  I put money in separate envelopes, but then I had to run to the bank to redeposit the money before paying bills. This led to overdraft fines.  I tried keeping track of my expenses on a note pad but I would leave the notepad behind in the store.  I had to figure out a way to keep on track on my own. Here’s how I did it.

Step 1.  I decided to open a new checking account just for fixed bills and groceries.  There are monthly fees in having a checking account so be sure to calculate for this or keep the minimum balance to avoid the fees.  I opted to keep the amount needed to avoid the checking fees.  (I did this to avoid using my savings account for emergencies.)

Step 2.  I went over my bills, changed any variable bills like my electricity bill to charge me an average instead of a fluctuating amount.   I calculated how much I spend on average on groceries and kept the total in my wallet.  By creating a menu plan, that includes all meals and snacks, I purchase all the food I need for the week and do not spend over that amount.

Step 3.  I totaled everything up and added a ‘social fun’ amount that is for going out and treating myself.  I have my paycheck automatically deposited into my new checking account and anything over my budget goes directly into savings.  Each week I take out my ‘social fun’ amount and put it in my wallet.

Now, I do not have to think at all about if I am going over budget or if I will have enough for savings.  I am less stressed and have gotten rid of my fear of money.

How do you keep on track? We invite you to share your ideas in the comment box below.