A balanced budget is essential to great money management.  It puts you back in the driver seat giving you control of where your money goes and what it gets spent on. 

Wouldn’t it feel nice to be in control again?  It will certainly lower your stress and help you sleep better at night.

You can get there!  It really isn’t that hard or painful.  Chances are you’ve developed some bad money habits over the years and just need a simple plan to get you back on track.

5 Simple Steps to Balance My Budget

Here are five simple steps to help you get your budget under control in no time at all:

1.  Determine Your Exact Income

You need to know exactly what you have coming in to balance your budget.  It is generally best to manage your money on a monthly basis.  So, start making a list of the various sources of money that you have to determine your total monthly income.  For some, this might be a very short list because you only have one source of income and that is your paycheck.  For others, you might have several streams flowing in from things like freelancing, alimony, child support, dividend checks and business ventures.

Make sure you don’t miss any income source.  Once you’ve got a complete list written down, then sum it up to determine your exact income.  This is the size of the hammer you have to work with to balance your budget.

2.  Track Your Spending

Okay, so now you know exactly how much money you have coming in each month, but where is it all going?  You need to take a month to track every single penny you spend.  You must determine where all your money is going.  This is an eye-opening experience.  You will likely be surprised and shocked at how much is being spent on things that don’t seem all that important.  Tracking your spending is a little arduous and most people won’t do it, but that’s why they stay broke.

This is a big step toward putting yourself back in the driver seat with your money.  You’ll be gathering the information you need to make smarter decisions about where you spend what you make.  Don’t you work too hard for your income to simply let it slip through your fingers?

3.  Determine Your Priorities

After tracking your spending for a month, compare your outflow of money to your total income.  Are you spending more than you earn?  It is likely that you are.  This means that every month your are sinking deeper in debt and moving further away from a peaceful night’s sleep.  You need to make some decisions to balance your budget.  You have to set the right priorities for your spending.

What jumps out at you from your log of spending over the last month?  What amount seems totally out of control?  Resolve to cut way back in the areas that are unnecessary so you start spending less than you earn.  This might seem impossible at first, but with just a little sacrifice it can be done.  Take a look at this list of 20 ways to cut spending and these 50 ideas to legitimately increase your income for some inspiration that will help you balance your budget.

4.  Develop a Clear Budget Plan

You’ll want to adjust your money habits on a monthly basis to conform to your new priorities.  The best way to do this over the long-haul is to start a monthly budget.  A budget is a plan you create at the beginning of the month that tells your money exactly what you want it to do for you over the next 30 days.  It is a tool you can use to keep yourself on track.  If you are married, then you both need to agree on the budget before the month begins for it to be successful.

Living on a budget is not as scary as it seems.  In fact, it greatly simplifies your life and reduces your stress because it puts you back in control!  Don’t resist budgeting any longer.  Your budget will become your new best friend if you will let it.

5.  Make Adjustments

You have to remain flexible because a rigid budget will die a quick death.  Life is not always predictable and people are not always logical.  Your budget needs to take both of these facts into account.  You are going to make spending mistakes especially at first.  It takes time to incorporate radical change into you life.  Don’t make excuses for poor decisions, but don’t beat yourself up either.  Resolve to do better next time.  In a few months, if you stay flexible, you will have balanced your budget and you will be feeling much better about yourself.

Be willing to make the adjustments necessary to make your budget work.  It may not be perfect in your eyes, but a slightly compromised budget that everyone agrees to is way better than no budget at all.

Great Money Management Is Within Your Reach

What small step are you going to take today to start getting your budget under control?  Don’t delay another minute!  You don’t have to swallow the whole pill in one sitting, but taking one little baby step right this instant will empower you and give you the confidence you need to change your life.  You’ll thank yourself later!

Photo by penywise

I’m looking for people willing to share their personal experience selling digital photographs online.  This is something that interests me, but I’ve never done it.  I’d like to hear from some real people about how to get started and what to expect.

Photography has always interested me.  I got involved back in high school as a yearbook photographer.  We shot, developed and printed all our own black and white pictures.  I particularly enjoyed shooting the photos.

I’ve just recently purchased a Nikon D40 Digital SLR Camera and it has been fun getting back into taking pictures again.  However, the entrepreneurial side of me wonders if I could use my rediscovered hobby to generate another stream of income.

My questions about selling digital photographs online

Have you tried selling your digital photographs online?  How did it go?  I’m trying to decide if this is something I want to pursue and it would be immensely helpful to know in advance what I’m getting myself into and exactly how to go about it.

Here are some of my questions about selling digital photographs online:

• Is selling photography on sites like Fotolia the best way to make extra money?
• How much effort is required to make $100-$200 a month?
• Is this market totally flooded to the point where it is difficult to make anything?
• What sites are best for selling photographs?
• How many photos do I need to upload before I can expect to make something?
• How difficult is it to get your photos accepted?
• Are there some particularly helpful sites for learning more?

I’ve been doing a little research and I’ve ran across some helpful information, but again I’m looking for real people willing to share their experience.  This is not something that I can spend whole days doing.  After all, I’ve got a day job.  I want to know if selling photos is something I can do on the side just to generate a little extra income for my sunny day fund.

Some of what I’ve learned so far about selling digital photographs

Selling pictures as stock photography doesn’t seem too difficult and there are a plethora of great sites for it, but I’m definitely concerned that it might not generate enough money to make it worth anything.

I ran across this Microstock Earnings Report for May 2009 and it makes me wonder if a guy like me that is already working full-time, raising a family and blogging on the side has a chance of making enough to bother.  My expectations aren’t that high, but after some time and effort I would like to be making at least $100 to $200 a month.  Is this realistic?

I know about model releases and avoiding photos that include trademarks or copyrighted material, but are there other things I need to know about what to photograph?  Is it possible to make money with photographs of nature, landscapes and common objects?

What kind of equipment do I need?  Obviously, I knew a good digital SLR camera would be helpful, but what else will I need?  I’d like to get up and generating a few dollars without investing a great deal more money up front.  I did get a 55-200mm zoom lens with my Nikon D40, but other than that I don’t have a lot of extra equipment.

What is your best advice for selling digital photographs online?

I’m really looking forward to hearing your suggestions.  I haven’t decided 100% to do this, but it is something that interests me keenly.  I hope you’ll take a few minutes and share your experience or thoughts with me.  I’m sure it will go a long way toward helping a newbie get his footing!

Photo by Chris. M.C.

Therefore, I decided to offer a mash-up of articles you are sure to enjoy.  Happy reading!

Great personal finance articles to stimulate your mind!

1.  Get the scoop on the latest economic stimulus checks

Did you know that we might be getting another stimulus tax rebate?  According to FreeFromBroke, the Brand New 2009 Economic Stimulus Is Out Of This World!  Besides just checks, there are a number of other incentives that President Obama wants to stimulate the economy.  This article includes all the details.  (Posted on April 1st – So Beware!)

2.  Learn to avoid blowing your severance package

The number of people that filed for first-time unemployment was up again this week.  That means that a lot of people are getting severance packages.  Ron at The Wisdom Journal warns to avoid these 10 Ways To Blow Your Severance Package.  Stretching out whatever is offered as long as possible is probably the better idea.

3.  Generate some extra income

For those laid off or just needing extra cash during this tough economic time, Madison at My Dollar Plan offers 12 Ways to Generate Extra Income.  Personally, I don’t agree with the ideas that involve credit cards, but I do think she offers many other worthwhile suggestions.

4.  Think long and hard about helping your kids with credit card debt

Finally, Frugal Dad addressed a topic that has probably impacted just about every family at one time or another.  He asks, Should Parents Pay Off Kids Credit Card Debt?  I think it would be hard to watch my children struggle financially, but I also think that the pain in paying off the debt would probably be a lesson they’d never forget.

Money doesn’t buy happiness, but these articles might!

1.  Get ready for Monday

I know it’s only Friday, but Monday will be here before you know it.  Sara at On Simplicity shares 7 Ways to Attack Your Monday Morning Stress.  There are all kinds of things that build tension and cause stress, but these fantastic ideas are sure to help.  Don’t miss checking this out!

2.  Quiet the negative voice in your head

I often wonder what is all that chatter I hear?  Then I realize it is just the noise inside my own head.  Fortunately, Jonathan at Advanced Life Skills tells us How to Calm Your Inner Critic.  This is actually a repost of an article from the Inner Noodle.  It is a fantastic read and an important message.  I hope you’ll take the time to check it out.

3.  Make yourself feel all warm and fuzzy

Need a shot that will make you feel good all over?  Well, I recommend reading The Blissful Art of Being and Breathing over at Marc and Angel Hack Life.  If this one doesn’t make you tingle with love and count your blessing, then nothing will!

Photo by pfala

Given the tough economy, many employment situations are changing rapidly.  There are inducements to leave being offered, layoffs occurring and businesses folding almost daily.

Tough economy or not, over the years, I’ve seen what I thought were some sure things go up in smoke for myself and others more than once.

I might have been naive, but I didn’t seem to be the only one that was caught flat-footed when their job or business hit the skids. 

The days when you could get a job and work until retirement are gone.  As a result, I’ve learned to look at the way I earn a living in a little different light.

The situations that brought about my employment views

First, let me clarify that I am using the term employment more broadly than just the case where you have a job working for someone else.

Employ – to use (as time) advantageously.
~ Merriam-Webster Online Dictionary

Going with this definition, I see one’s employment as the way they are using their time to earn a living.  It could be at a traditional job in the private sector or working for the government or in a business they own.

I’ve come to realize that no employment situation is 100% completely secure.

Let me give you some examples.  I share these not to stir fear, but to help us all acknowledge we must take personal responsibility for our livelihood.

1.  First employer went out of business due to new competition

The chain of supermarkets where I bagged groceries in high school ended up going out of business because they couldn’t compete with the discount stores.

2.  Air Force forced many out due to reduction in forces

I entered the Air Force in the early 90s.  Shortly thereafter, a reduction in forces (RIF) was conducted that asked many officers to leave the service.

3.  Lifetime of service rewarded with forced early retirement

As a training coordinator, I once hired a gentleman in his early sixties that had only one previous employer on his resume.  He had worked his entire life for the local electric company until they forced him into early retirement.

4.  Laid off abruptly when employer suffered IRS judgement

In one of my early IT jobs, I worked at a small consulting firm until one Monday morning when the owner announced he had received an IRS judgement against him that he couldn’t afford to pay so he was closing the business.

5.  Change in CEO resulted in company divorce and layoffs

I managed and was minority owner in a small company owned by a larger entity.  When the larger entity got a new CEO, he decided he wanted to change all the rules.  Our companies ended up splitting up over the disagreements.  My company lost its biggest client and I had to personally lay off some of my employees.  It wasn’t easy.

How these situations changed my employment views

First, let me say, that despite the events above that affected me personally, I have never been unemployed without an income since high school. 

Also, I am not bitter nor do I really have any regrets about any of my employment or business decisions despite the fact that some of them ended unexpectedly.

I learned from all these situations and I believe I am wiser today because of the experiences I have had.

Here’s some of what I’ve learned.

1.  Your value as a person is not connected to who writes your checks

Yesterday, I wrote about how we judge success.  In that article, I tried to make the point that there are better things to use as yardsticks in life than your title, job or even your income.

Employment situations are going to change.  If you tie your self-worth to the method you use to earn a living, then your confidence is going to get beat up.

I’ve learned that my value has nothing to do with who writes my checks.  I am my own person with talents, expertise and skills that stand on their own.  Situations may change, but deep down, I will be the same person today that I am tomorrow.

No matter what happens, I can find someone else that will recognize my contributions and reward me accordingly.  This is true for all of us.

2.  Never become too comfortable where you are at

We can lull ourselves into feeling too secure.  It is never a good idea to become too comfortable where we are and fail to keep ourselves competitive.

 Stephen Covey told us in Seven Habits that we must continually sharpen the saw.  If you aren’t learning something new, then you are falling behind. 

Being behind in your skills and unexpectedly finding yourself without an income is not a good place to be.

Staying up-to-date in your field and continuing to make new contacts is an important way to maintain real security.

3.  Always view yourself as an independent contractor

A good independent contractor is always on their toes.  They have to be in order to keep a steady stream of income flowing.

No matter what your employment situation is, think of yourself as an independent contractor.  If you have a traditional job, then you just have one big client.

The way an independent contractor works and thinks is beneficial because:

• They are always trying to add value and uncover new projects to prolong their current contract
• They know their current contract will end eventually so they continually keep their eyes and ears open for where their next opportunity might come
• They part on good terms being sure to never burn bridges
• They are flexible and willing to be innovative in the contract arrangements in order to get a job and keep it going
• They know their livelihood is their responsibility.  They have to hustle to keep the money flowing.

Adopting the mindset of an independent contractor will minimize the probability that you will ever be without income for long.

4.  You are not married to your current employer or business

Marriage is until death do us part.  Your employment situation lasts only as long as it is mutually beneficial.

Once either party decides they are no longer deriving enough benefit from the arrangement, then the gig is up.

I have seen way too many people stay in a situation way too long because of some emotional hang-up that they weren’t willing to let go of.

In most cases, the emotional hang-up is fear of the unknown.  Don’t overstay your welcome just because a big change is scary.  Make a change on your terms or it will happen when you least want it or expect it.

Don’t get me wrong.  I strongly advocate loyalty to those helping to pay your bills, but you also have to view your employment as a business arrangement.  Be logical!

These employment views will serve you well

Adopting these attitudes toward your employment situation will help you to avoid large gaps in earnings.  It has worked for me despite some tough circumstances.

Again, these views apply whether you work for yourself or someone else.  You can adapt them yourself to fit your situation.  Hope they help!

What views would you suggest along these lines?

Photo by _StaR_DusT_

I’m guessing that a lot of people feel financial freedom is out of their reach. 

Well, I beg to differ with them.  I believe it is possible to save one’s income to become rich.

You don’t even have to make a ton of money to become a millionaire.  All you need is the desire to do well with your finances and a little creativity.

Believe you can save your income for financial freedom

Does this already sound like a late-night television infomercial?  Well, it’s not.  However, it is hard to write about becoming wealthy without starting to sound that way.

Stick with me here and I’ll show you that my plan for achieving financial freedom is not a fly-by-night scheme.  In fact, it is very realistic for most of us.

Becoming a millionaire is relatively simple.  It isn’t altogether easy, but it is simple.

Take a look at the chart below.  It assumes a 10% rate of return on your investments.

If you save $500 per month for 30 years earning an average return of 10%, then you will become a millionaire.  It is as simple as that.

So, what if you plan to retire in less than 30 years or what if you don’t have $500 a month to save?  Well, as the chart above illustrates, you can still build a respectable nest egg.

For example, if you invest just $300 per month for 25 years, you will have almost $400,000!

Of course, the earlier you start the better.  Look at the figures in the 30-year column compared to the 25-year column.  Waiting an extra five years makes a big difference.

If you are in your 20s or 30s, I implore you to start a regular investment plan now!

Two critical components to achieve financial freedom

The two most important things you have to understand in order to become rich are:

• You have to pay yourself first and
• You have to make your savings automatic

Paying yourself first means you budget an amount to save every month and live on what’s left over.  Most people do the opposite and wind up broke.

When savings is your top priority, you schedule to have money automatically deducted from your paycheck or checking account every month to be invested.

This strategy for savings ensures that you follow your plan which guarantees that you will become rich.

Okay, let me add one caveat to my guarantee.  There are always exceptions, aren’t there?  You have to wisely invest your money to earn your planned rate of return.

How to invest to save income for financial freedom

I believe growth stock mutual funds are a good way to invest for retirement.  I know that the stock market has taken a beating lately, but historically, over the long haul, the market has performed very well earning around 10%.

Of course, as many are quick to point out, past performance is not necessarily an indicator of future returns. 

I invest my money in mutual funds for a few reasons:

• By definition, they are diversified.
• Good mutual funds, have a long track record of solid earnings
• They are easy to understand and purchase

A good investment strategy for getting rich is boring.  It grows slowly, but steadily.  This is not exciting, but it is dependable.  I believe in the K.I.S.S. principle.

Things to point out about saving income for financial freedom

I hope you will take a few moments and study the chart above.  Again, it is simple, but very revealing.  Look at it carefully and absorb all it tells you.

Let me point out a few things to observe:

1.  The savings scale stays between $100 to $500

I kept the monthly investment low on purpose.  I wanted to illustrate that even a modest amount of money can grow into a big result.  Let me reiterate that it does not take a six-figure income to get rich.  You just have to practice some basic financial principles and then let compound interest do the rest!

2.  The years scale shows an investment horizon of 20 to 30 years

Investing for wealth is a long-term proposition.  The longer you have to invest, the easier it will be to become a millionaire.  Of course, it is possible to save a lot of money in a short time, but you would likely need to significantly increase the amount you were saving monthly.  Hopefully, you are in your 30s or 40s and still have time to easily get rich.

3.  The chart doesn’t lie.

The chart is the whole reason that I wrote this post.  It is a reminder to me and hopefully to you too that it is possible to get rich.  If you believe you can, you will.  Yes, it takes some discipline and a plan, but with just a little effort, time and money you can become a millionaire!  Isn’t that encouraging?  It is to me.  The chart is my vision for the future.

Are you going to become a millionaire?

I end with the question I asked in the beginning.  Becoming wealthy is a decision you can make.  What do you choose?

For many, they will continue a consumption lifestyle, pass that legacy on to their children and end up in the poor house (i.e. a facility that accepts Medicaid).

I have chosen to finish my life better than that and to help my kids get off to a better start in handling their money.  My plan isn’t glamorous, but it will work.  I will be a millionaire!

What say you?  Are you going to become a millionaire?

Photo by UKDevon

Fortunately, Jason from Live To Budget, has put together a very nice eBook with articles from several well respected personal finance blogs.

Spend Less Than You Earn eBook

There are several very nice things about this eBook worth noting:

• It is 100% free!
• You can download it and read it at your leisure offline.
• It contains wonderful advice from multiple authors.
• It will help you get control of your money.
• Two of my articles are included in it!

What more could you ask for?!?  I hope you’ll take a minute to download the eBook and peruse it at your leisure.

Click here to download the Spend Less Than You Earn free eBook!

I want to assure you that there is absolutely no gimmick or obligation involved in downloading this eBook.  It is simply a way for several bloggers to cross-promote our personal finance blogs.

The eBook is in PDF format.  You may need Adobe Reader to open the file.

What you will find inside of Spend Less Than You Earn

Here’s a sneak peek at some of the titles that you’ll find in the eBook in the order in which they appear:

• 10 Tips For Reducing the Power Bill @Lightening
• How to Reach your Financial Goal @My Debt Free Goal
• 10 Surprising Side Effects to Money Management @Simple Mom
• The ABCs of Frugality: 26 Key Frugal Concepts @Almost Frugal
• Start a Grocery Budget Limbo @Live To Budget
• What Everyone Should Know About Personal Finance @Blunt Money
• Now is a Good Time to be Living on a Budget @My Super-Charged Life
• Best Personal Finance Idea of the Year @Credit Withdrawal
• How Credit Card Companies Apply Your Payments @Mrs Micah
• How To Budget With Irregular Income @Being Frugal

I hope you enjoy the eBook!  I’d love to hear what you think about it.  Please leave me a comment below and let me know your thoughts!

I often think about how I would adjust my budgeting priorities should I lose my job or find myself in some other ultra-tight financial situation.  I believe that by acting quickly and decisively, I could significantly increase my chance of success.

A budget is a plan that should align one’s spending with our priorities.  In a crisis, I would use mine to batten down the hatches and ration my money to my top priorities.

Budgeting priorities when money is tight

The global economic crisis is tough on everyone right now.  The cost of living is up and a lot of people are losing their jobs.  When money is tight it is more important than ever that we set our budgeting priorities correctly.  I would start with the basics and go from there.

Here is how I would prioritize my money in a budgeting crisis:

1.  Groceries are at the top of the budget

We all have to eat to survive.  In a pinch, I would make food my top priority.  However, I would be sure that I was buying only staples.  My diet would not be anything fancy.  No restaurants and no T-bone steaks. 

In a personal financial crisis, my food might not be that enjoyable, but it would give me and my family what I needed to keep from going hungry.  I would buy things like macaroni, beans, rice, and potatoes.  I would avoid frozen dinners, soda, chips, desserts and other junk food that is too expensive.

2.  Paying the mortgage or rent

Once you are fed, then you need a place to live.  I own a home, so my next priority would be my mortgage payment.  I have too much invested to let my home fall to foreclosure. 

If I did anticipate falling behind on my mortgage, I would be proactive.  I would go to the bank and work something out ahead of time.  From what I hear, this will lead to a much better result.

The mortgage company may not scream as loud as some of the other creditors we owe, but I would still pay them first.  Harassment should not define our priorities.  I would definitely make keeping a roof over my head one of my top priorities.

3.  Transportation to and from work

When things are tight, we must earn as much income as possible.  Therefore, I would need some form of transportation to get to the first job I could find.

Fortunately, I don’t owe on my vehicles, but if I did I might have to let one or more cars go if the payment was large.  But before I did, I would figure out a transportation alternative.

Riding the bus might not be convenient, but it is better than letting my house get taken by the bank.  I would throw my pride out the window!  Crises are survived by making hard choices!  Choosing public transportation is an option I would seriously consider.

I might also think about walking, riding a bike or scooter, or carpooling as ways to save money while still getting where I needed to go.

4.  Utility bills

I would cut off everything except what I absolutely needed to survive.  I would do this as soon as possible!  Things like cable TV and cell phones are luxuries not necessities.  Ditching them would be some of my first steps.

I would then prioritize the remaining utilities in the order in which I would need them to survive.  As an example, here is how I might prioritize the utilities from highest to lowest:

• water and sewer service
• electricity
• natural gas
• telephone

Obviously, it would be uncomfortable to do without any of these, but if I can’t pay the bill, then I would have to let something go.  I want to control the situation as much as possible, so I would prioritize.  I would also take drastic steps to reduce my utility bills.

5.  Essential clothing

In a crisis, I would make sure my kids had what they needed to stay warm.  I don’t think clothes would be an issue for us unless the crisis lasted for six or more months, but kids do grow so I would need to consider clothing eventually.

I would not concern myself with fashion.  For me, this would be a time where function would rule.  I would shop for clothing at secondhand stores and even look for hand-me-downs from extended family members.

Clothing is important, but most of us can probably make do for a long time without needing to buy much.

6.  Credit cards would be the last to get paid

I am debt-free, but if I owed on credit cards or unsecured consumer loans, then these would be the last things that I would pay.  I might get a lot of harassing phone calls, but I’d just have to ignore them.

From what I understand, it would take these companies a long time before they actually sued me.  Therefore, I would put them off as long as possible.  I would hope that my situation would change before the worst occurred.

Setting the right budgeting priorities are key to surviving

I would want to make the right choices early to minimize the impact of a financial crisis on my family’s livelihood.  Some might think that my approach is radical, but I don’t think so.  Taking decisive action would put me in the best position to weather the storm for as long as possible with the minimum negative impact.  Failing to act is what leads many to bankruptcy and foreclosure.

Is there anything I missed in my crisis budget priorities?

Other articles that might be useful:
Back To Basics- 79+ Brilliant Budgeting Resources You’ll Love
Now Is A Good Time To Be Living On A Budget
How To Avoid Buying Things You Do Not Need!

Photo by aturkus

Making a few financial sacrifices is kind of like ripping off a band-aid.  Sure, it hurts a little just for a second, but then the pain goes away and you realize your boo-boo is all better. 

Is it time for you to make some changes to your finances?

Someone once said, “The definition of insanity is doing the same thing over and over again and expecting different results.” 

Are you guilty of this behavior in your personal finances?

If what you have been doing up to this point isn’t working, then it is time to try something new.  It is time to get radical!

Take a look at your finances and net worth (assets minus liabilities).  Are you gaining or losing ground?

Many people have a decent income, but still seem to barely be able to keep their heads above water financially.

If this is you, then the only way to start getting ahead is by creating margin.  You have to get your spending down below what you earn.  How do you do this?  By making some cuts.

10 Ways to frugal up your finances in a hurry.

Okay, so you are ready to make some sacrifices, right?  You have made a serious decision to get your spending under control so you can have money left over to create an emergency fund and pay off some bills, but you aren’t sure where to start. 

Well, let me give you a few ideas.  Once you get started, you’ll find all kind of places to reduce spending and save money.

Keep in mind that not one of these by itself is going to be the solution you are seeking.  It is the savings from making several cuts that when added together will give you the traction you need. 

You will be amazed at how even $100-$200 of monthly margin will get the ball rolling on your personal finance bailout plan.

I want to let you know that this isn’t just a list that I’m making up.  I have personally taken these steps myself.  As a result, in less than two years, my wife and I paid off about $28,000 in debt and started seeing our net worth increase substantially!

Here’s what we did:

1.  Give up cable or satellite television.

I can hear the screams from here.  I figured that I’d lead off the list with one that will make many people squirm.  I’m testing your resolve here.  There are numerous excuses for why you need the extra channels, but none of them hold water.  Call today and have the cable or satellite company cut off or at least significantly reduce your service.  It might save you $25 to $75 per month!

2.  Stop eating out all the time.

Restaurants are expensive!  Have you added up what you are spending each month on eating out?  When my wife and I did this, we were shocked!  This was a tough area for us to cut back in because it was something we seriously enjoyed.  Therefore, we didn’t stop eating out all together, but we did cut way, way back.  We budgeted a certain amount each month and when that money was gone, we ate at home.  Again, this could easily save you $50 to $100 per month or more!

3.  Cut telephone costs.

Look for ways to lower your monthly cost on your home phone and your cell phone.  My wife decided to move to a pre-paid mobile phone which saved us most of her monthly cell phone expense.  We also negotiated with our long-distance company to get a lower rate.  I have also heard of people eliminating their home phone altogether to save money.  These efforts could save you $40 to $60 per month.

4.  Go to the library and stop buying books.

I love to read and prior to getting control of my finances I bought books regularly.  However, to save money I decided to reacquaint myself with my local library.  I now check out books, music CDs, and DVDs regularly.  I can search and reserve books on the library’s website.  They then ship the books I desire to the library of my choice for pick-up.  It is all very convenient and never costs me a dime!  This saves me at least $20 per month.

5.  Adjust the thermostat for savings.

You can save a significant amount on your monthly electric and gas bill by adjusting the thermostat by a few degrees.  In the summer, we turn the thermostat up during the day and wear shorts around the house when we are home.  In the winter, we turn down the heat at night and throw an extra blanket on the bed.  You can even automate this with a programmable thermostat.  This saved us $20 to $30 per month.

6.  Stop going to the mall.

Going to the mall is not entertainment!  We used to go when we were bored.  Of course, we usually ended up spending money while we were there.  If you need clothes, then shop sales or go to stores that offer name-brands at a discount.  You can save a ton on these items if you are a smart shopper.  Dave Ramsey says, “Never pay retail!”  We probably save $15 to $30 per month by staying away from the mall.

7.  Cut your spending on groceries.

Buy the basics at the grocery store.  You will save a tidy sum by buying staples and cooking at home.  Search the Internet for cheap and easy recipe ideas.  Cut some coupons and shop at discount grocery stores instead of the full-service chains.  Eat simple, healthy meals that are nutritious without costing a fortune.  By cutting back on groceries, we saved $40 to $50 per month.

8.  Sell off some of your toys.

Many hobbies end up costing a lot of money.  I love recreational activities, but there is season in life for everything.  It might be time to scale way back on some of the toys in order to get some financial freedom.  We sold a boat, Seadoo, and hot tub to cut back on our expenses.  It not only saved us some monthly payments, but it also eliminated storage and maintenance costs.  This saved us $60 to $90 per month.

9.  Scale back this year’s vacation.

I love adventure!  So, the thought of a staycation or even cutting back severely on our vacation plans seemed sacrilegious to me.  However, we did it and it wasn’t that bad.  We set a budget and then worked hard to plan a trip that stayed within the boundaries we set.  It worked out beautifully and turned out to be very enjoyable.  It is absolutely possible to have a good time without busting the bank.

10.  Get competitive quotes on your insurance.

Visit or contact an independent insurance agent to get competitive quotes to save money on your auto, homeowner’s and term life insurance.  Now is a great time to get better rates on insurance.  If you haven’t compared what you are paying recently, then I highly encourage you to do this now.  It saved us $50 to $60 per month.

Are you ready to stop whining and frugal up?

If we continue spending our money in the same manner as we always have, then we are going to get the same results we’ve always gotten.  Make sense?  By following the advice above, you can conservatively cut about $300 off of your monthly expenses!

If you want to do better with money, then stop whining and wasting precious time!  A proverb states, “The best time to plant a tree was twenty years ago.  The second best time is now.”  Today, you have the power to make positive changes in your personal finances that will help you achieve greater success tomorrow.

What’s the alternative?  Would you rather continue living with the stress, anxiety and pressure of trying to make ends meet?  I didn’t think so!

What other ideas do you have for frugaling up your finances?

Photo by africankelli

The ultimate guide to personal finance budgeting.

Originally, I was going to write an article about how to put together a budget.  However, as I thought about it, I realized that I could never cover all the important aspects in just one article.  Besides, there were already a lot of great articles already written about personal finance budgets.  Instead, I decided to assemble this ultimate list of budgeting resources.

It doesn’t matter whether you are just getting started creating a budget or if you are a budgeting pro.  You are sure to find some interesting, practical and useful advice below.

Why you need a budget

If you are aren’t even sure you need a budget to succeed with money, then this is where you need to start reading.  Below you will find explanations for why budgeting is crucial to getting ahead with your finances.

1.  A Budget Controls Your Money Like A Dam Controls A River

2.  Things I Learned Living on a Budget – Part 1, Part 2, & Part 3

3.  What is a budget?

4.  Creating Our First Ever “Real” Budget Was An Eyeopener

5.  Turning Around Your Financial Life (Part 2 of the story)

6.  Lessons from Grandma’s Cookie Jar

7.  In Defense of Budgets

8.  Top reasons people don’t budget

9.  10 Surprising Side Effects to Money Management

10. Realistic Budgeting- The Marriage Saver

11. Why Not Budgeting is More Frightening than Budgeting

12. The Scare of My Life, and Why Budgeting is Important

13. Having A Plan Allows Me To Enjoy Spending Money

How to create and maintain a budget

This is where the rubber meets the road in budgeting.  These articles will give you detailed information for creating and maintaining a personal finance budget.  Together these articles form a definitive guide to putting together a budget.

14. How to Implement an Envelope Budgeting System

15. Envelope Budget System Strategies To Take On the Road

16. Getting started with the envelope budget method

17. Keep Your Spending Tidy With an Envelope System

18. Budgeting For Dummies Part 1-  Creating a Budget

19. Budgeting for Dummies Part 2-  Evaluating Your Budget

20. Budgeting for Dummies Part 3-  A Budget You Can Stick To

21. How To Realistically and Thoughtfully Increase A Budget Item

22. Create and follow a Budget

23. Zero-Based Budgets for the Home- A Primer

24. Making Every Penny Count With A Zero-Based Budget

25. Family Finances- Our Modus Operandi

26. The Budget Toolbox- 13 Tools for Building a Better Budget

27. A Quick and Dirty Budget

28. Your budget- envelopes or a plan?

29. Budgeting 101- How a Simple Budget Helped Me – And Can Help You, Too

30. Guide to Budgeting & Tracking Money For Newlyweds

31. Budgeting For Two- Newlyweds Edition

32. Fixing your money mistakes- Create a budget

33. Budget Easy and Smart

Tips and Tricks for living on a budget

Adjusting to living on a budget will take you outside your comfort zone.  You will have plenty of questions about how to handle specific situations.  Therefore, I have provided you with lots of great articles that cover a plethora of budgeting dilemmas.

34. How to Handle Irregular Paychecks

35. The Readers Ask- “How Do You Budget With an Irregular Income?”

36. How Do You Handle Unexpected Expenses?

37. Could Your Family Live On One Income?

38. 9 Tips For Going To One Income

39. How To Avoid Buying Things You Do Not Need!

40. How do you deal with a budget deficit?

41. 10 Ways to Eat Out For Less

42. 3 Tips on Eating Out for Five but Paying for Only One

43. Make Grocery Budgeting A Game, The Price Is Right Style

44. How to work expensive ingredients into your grocery budget

45. What Is Your Weakness?

46. Winning the Daily Cash Flow Battle

47. 22 Money Maximizing Moves You Can Do Today

48. 34 Ways To Save Money On Car Expenses

49. How To Frugally Decorate Your House On A Very Tight Budget

50. How Low Can It Go? Shopping for Style on a Budget

51. how much do i need to earn? reverse engineering my ideal salary

52. Preparing a Budget- Ten Tips for Making That Budget Successful

53. Vacation Budgeting Hack – Don’t Forget About Tips!

54. 13 Free or Cheap Ways To Keep Your Home Cool This Summer

55. Are You Throwing Money Away? Unused Expenses and Untapped Discounts

56. Key strategies to a successful budget

57. Three Ways Falling in Love is Good For Your Budget

Budgeting mistakes to avoid

This section is the troubleshooting part of the guide.  Why make the same mistakes that others have already made?  By reading these articles, you can learn to avoid the most common pitfalls of personal finance budgeting.

58. Our Dumbest Purchase Ever

59. 10 Mistakes I Made As A First Time Home Buyer

60. My Biggest Budget Busters

61. What Busts My Budget

62. Don’t Make the Fatal Flaw in Budgeting

63. Money Mistake Monday – Watching Every Last Penny Syndrome

64. 5 Common Money Mistakes

65. If You Get Your Paycheck A Few Weeks Early – Be Careful!

66. Intentionally spend your money

Budgeting software to consider

Every remodel job is easier to complete successfully with the right set of tools.  There is a wide-range of personal finance software available to help you track and refine your budget.  The reviews and information below will help you pick the package that fits your specific needs.

67. My New Personal Finance Software- YNAB Pro Reviewed

68. Mint.com Money Management Software Review

69. Mint- A Fresh New On-Line Personal Finance Tool

70. Mint Review – How Secure is it?

71. Mvelopes Personal Finance Software Review

72. Get Out Of Debt-  PearBudget Spreadsheet Hacks

73. PearBudget- An Effective Way to Dip Your Toes into Budgeting

74. A Free and Simple Budget Planner

75. Free Budgeting Tools to Download

76. An Introduction to Quicken Online

77. The Best Budgeting Tools

78. 10 Online Budget Tools

79. My Personal Excel Budget Spreadsheet

A budget will get you on your financial feet fast!

A good budget is a critical step toward financial peace and you will not find a finer collection of articles on personal finance budgeting anywhere!  These articles are practical and simple.  Anyone can benefit from their advice.  Do not delay!  The sooner you get started the sooner you will reap the rewards!

Photo by Jeff Keen

Money is the root of many good things in our lives.

It seems strange that a need exists to convince people that they need to be more financially responsible, but you don’t have to look far to find someone that has created a personal finance nightmare.  There are three basic components to a sound financial strategy that will ensure you have money to live a nice lifestyle.  They are:

1. Earn a good income.
2. Control the money you have.
3. Make sound investments.

If you are failing in any one of these areas, then you will most likely face some rough financial times ahead.  Maybe you’re already struggling.  The good news is that it isn’t that difficult to get things headed in the right direction.  I’ll share more on that in a minute, but first let’s back up and examine why we should be motivated to be more responsible.

The ways that money defines your life.

I think it is valuable that we review why money is important to us.  If we aren’t being financially responsible in the three areas listed above, then maybe its because we haven’t stopped to examine what money really buys us.  Maybe we don’t realize the extent to which money defines our life.

1.  Money defines our level of freedom.

The more money that you have the freer you are to live your life the way you desire.  Money opens up a wealth of freedom like travel, leisure, and choice of occupation.  If you aren’t strapped for cash, then you can take time off, go on awesome adventures, and pursue the job of your dreams.  Being financially responsible creates margin in our lives to make our own choices.  These things are possible if you choose to be financially responsible.

2.  Money defines our emotional well-being.

Having a pile of cash gives one a sense of security.  When you have money, you can relax and rest a little easier because you know that you have the resources available to deal with most situations that arise in life.  There is usually less stress in life when you have adequate financial means.  You don’t have to worry as much about things like paying the bills, meeting your kids expectations, and how high gas prices are getting.  Money affords you an easier life.

3.  Money defines our physical well-being.

Many believe that those with more money enjoy better health and live longer.  This could be for any number of reasons.  For instance, with money a person can afford better health insurance and healthcare.  The best doctors are often only available to those with the right kinds of coverage and money to pay for what insurance doesn’t cover.  Also, as discussed above, people with more abundance often suffer from less stress which is a major contributor to all kinds of health issues.

4.  Money defines our power.

It is no secret that money talks.  It often greases the wheels of getting things done.  This is true at the highest level of government down to getting something fixed in your home.  If you have money, it is likely that you are going to get faster, better service from everyone.  Some might think that this isn’t fair and it may not be, but it is reality.  Money gives you power to get your way more often.

5.  Money defines our social life.

Your level of wealth determines where you live and who you associate with.  It is impossible for someone of lower means to hang out much with people of a higher means.  You can’t afford to go to the same places and do the same things.  You can’t live in the same neighborhoods, wear the same clothes, or drive the same cars.  You can’t go to the same restaurants, frequent the same establishments, or go on the same vacations.  Generally, your social network is going to consist mainly of those with about the same financial habits that you have. 

6.  Money defines our wealth.

This may seem obvious, but let me expand the thought for a moment.  Most would agree that, the more money you have the easier it is to get.  It takes money to make money.  If you are a poor earner and bad manager of what you do have, then it isn’t likely you will have any money to invest in ways to build wealth.  This prohibits you from getting your money working for you.  On the other hand, those with money often make more money with little to no physical effort on their part.  They can invest to earn interest and dividends.  They can also hire others to do the labor.  Money breeds money.  You need more to have more.

Choose to have more money and change your life.

As you can see, poor financial habits may limit you in a number of ways.  It is time to decide to do better.  You want a better life, right?  So, why not get it?  It really is a choice you can make.  You may not think it is possible, but there are many people that would tell you different.  In fact, if you think you can’t get ahead, then I would highly recommend reading Larry Winget’s book titled, You’re Broke Because You Want to Be: How to Stop Getting By and Start Getting Ahead.  This is the book that inspired me to write this article.  It is a quick and easy read that could change your life.

Once you have decided to get more money and get ahead financially, then I would suggest reading the following to get started in the right direction.

7-Day Turnaround- That’s a Wrap – An excellent series of articles on how to change your family’s financial destiny.

Dave Ramsey’s 7 Baby Steps – If you aren’t familiar with Dave Ramsey, then my advice is to read this.  I am about 75% of the way through Baby Step 3.  I am convinced that this is a great methodology to start getting ahead with money.

There’s No Shame In Not Being Able To Afford It – Often our problem with money stems from our ego.  We have to decide that being more successful with money is our top priority.  You should read this to help adjust your attitude.

Borrow, Barter, Buy Used- Espousing The Frugal Lifestyle – Again, it is all about how bad you want it.  If you are serious, then this article will help get you started in cutting back on your lifestyle so you can create margin in your life.

40+ Alternative Income Ideas and Resources – Get busy and earn more money!  Here are a plethora of ideas for how to do so.

Plan Ahead- 6 Steps to Secure Your Financial Future – Successful planning is essential to being wise with your money.  You do have a plan don’t you?

Everyman’s Guide to Increasing Income – Dave Ramsey says,
“Your income is your best wealth building tool.”  In fact, it really is your only wealth building tool.  Forget about winning the lottery and get busy!

25 of the best books about money – Read everything you can get your hands on about be more wise with money.  Here’s an excellent list to get you started.

You CAN Get Out of Debt! – It’s true!  If you don’t believe me, then read this for a second opinion.  Make the decision to be free today.

7 Solid Tips For Living Debt Free – Make a decision to get debt free and then read these tips to help you along the way.

How will money define your life?

Okay, I’ve told you how money defines your life which hopefully has convinced you to earn more and manage it wisely.  I’ve also provided you with an incredible list of reading material that will send you off in the right direction.  All that is left is for you to make the decision that you want to get ahead with money.  What legacy will you leave?

Photos by erikogan and E.Al-Sheikh

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