What are you freaking out about? It is just numbers on paper. It is just a record for each month of the year. It is very hard to recover people from panic mode when you start talking about doing a "budget." To many people think a budget is the end of their exciting lives and they must enter into a life of boredom. A life where they never go out with their friends again and they eat food that taste like cardboard all in the name of saving money.

Well, relax. It is nothing like that. It is really just a plan! A spending plan to be exact. A plan for how you are going to spend your money. Up until now you and your money have been going through life blindly and all that has gotten you is frustration. You are frustrated that you are not closer to your financial goals even though you were hard every day!

The frustration comes from not having a plan. If the coach of a team wanted to win the biggest game of the year do you think they would send the players out without a plan? NO! Why? Because they want to win! Winning in anything takes a plan and your money is no different. So how does this plan work? First you have to have completed your two week expense tracking which you can find here. Once you have your two week expense tracking then you have to put your plan together. Your spending plan!

Your spending plan is going to finally let you know how much money is coming into your household and how much is going out. It is that simple. At the top of the spending plan you are going to list everything that puts money in your pockets. That could be income from your job, stock dividends, a pension check, anything that increases your bank account each month. Next you are going to list everything that takes money out of your pockets.

That is where the two week expense tracking comes into play. You are going to look at everything you spent your money on the last two weeks and list it. If you spent $80 on groceries then for the month you write $160 as your grocery expense because I am sure you plan on eating the entire month not just two weeks. Once you get all of your expenses down you can definitely see if you have more month than money or close to it because you are now able to subtract your true expenses from your true income.

Your new plan can be on paper or it can be electronic. Whichever way you are more comfortable with. Many banks and credit unions have their own software attached to your debit card which makes it even easier. The spending plan will take a few months to get used to so don't give up! The hardest part about the spending plan is just making it up in your mind that it is not a pathway to boredom, but instead a pathway to financial happiness!

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