• Put budgeting into your mind it is not something to do at the end of the day, it should influence all your purchasing decisions, whenever there is an outflow that is a good time to identify a potential saving. If you budget in this way you will get out of debt more quickly, and remove your need to use credit cards, this will have many benefits not least reducing the stress associated with debt and the friction this can cause. It will ultimately increase your freedom in a much truer sense than the false freedom a credit card provides.
• Set up goals to work towards, one goal could be getting out of debt, the next is saving up for retirement, but you can also have other goals such as saving up for a particular purchase or reducing your debt by 10%, or saving enough for an emergency fund. Once you have this goal figure how much money you need to save up to meet this goal, and have that in mind when constructing your budget from your current income. It can also help when you need to make the necessary cutback in the entertainment budget.
• Figure out your current budget level and categorize your spend, make sure to also include expenses which do not necessarily happen every month, for example repairs and maintenance, or paying insurance. Even wedding and birthday gifts can add up to significant amounts. With fees such as insurance for the car it is a simple case of dividing by 12 and putting this fee in your budget, with other expenses which are random you need to estimate from your last years spend on these items, and with your judgement whether these are getting higher or lower. If you are spending a considerable amount on this, you can see if you can cut down the spend.
• Subtract your income from your expenses this gives you your net inflow or out flow of cash per month, you goal should be to match this to the goals you set above
• Figure out where to save this will be most dependant on your personal position and what you spend money on. For debt interest repayments see if you can reduce the interest you are paying by consolidating loans or by move your money to the lowest interest rate. See if you can switch your insurance to a cheaper provider. Entertain in your house rather than going out. Drastic changes include moving house to live somewhere cheaper, moving closer to work to save on travel fees. Don’t buy a new car by a used one.
• Stop your spending impulses this can be achieved by putting your credit cards out of your wallet and removing the credit card numbers from online stores. By automatically putting your savings into your savings account after your pay check goes in. Any time you spend anything justify it in your mind in the framework of the budget. Make sure you keep all receipts to track the spend.
• Track your progress and adjust accordingly, your first budget will not be ideal, it will have unrealistic expectations, but that is too be expected, adjusting to the new budget will take time. So tweak your budget, especially when looking at your entertainment budget choose what to do and what not to do on the expense it costs you per hour enjoyment, some items such a good book can last you much longer than a night out and be much cheaper. It is not being suggested that you cut it out completely but rather do less of it, just cutting out two or three nights out a month can save you hundreds.
• Keep realistic expectations not realistic that you will necessarily be able to cut your entertainment budget down to zero and still be happy, or to cut your food budget in half and still be satisfied. Instead set some achievable goals that you can work towards.
• Get everyone one board as if you are budgeting for more than yourself then you need to get everyone working towards that goal also. It is no use you being thrifty if someone just goes and spends the money because there is more available. Everyone needs to keep track of expenses. This goes for kids also, give the children a set amount and tell them that is what they have to work with, tell them they don’t get any more until next week or next month. This structure has the added benefit that it is self reinforcing, if one person starts to go out of line everyone else pulls them on this. Again for this to work everyone has to be onboard with the overall goal, whether it be getting out of debt or saving up for the family holiday.

• Saving up for retirement can be a strong reason to start saving now, generally the support provided by the government is minimal, depending upon where you are located. At some point in your life you may want to slow down, or have to due to the effects of aging. In this case it is ideal to have a good pot of money saved up so that you don’t have to keep on working even though you do not feel up to it
• Saving up for a holiday another good reason to save up is a holiday, this can help to recharge the batteries as well as give a good opportunity to further bond with your family or friends
• Saving up for your children’s education another fantastic reason to start saving, giving your kids a good education is one of the primary things you can do to improve their life
• Saving up to get out of debt helps you to improve your situation by not having a constant drain on your income. Especially important if you are paying very high interest rates on your debt. Getting out of debt is more than possible, it just takes commitment and a recognition that you can’t have everything, at least not right away

Before going shopping make a list: Making a list of all the things you want to buy is essential to staying in budget. When you are at the shop make sure you stick to your list. That way you won’t be tempted by special offers or products which you did not really need.
Shop quickly: this will reduce the temptation to buy, shops spend billions to entice you to buy what you don’t need, and the shop itself is their playground, it has been designed specifically to make you buy
Use unit price to compare products: When comparing between two products make sure to compare the unit price, rather than the total price displayed, as packaging can make two products look different sizes. Also the largest size is not necessarily the least expensive, be sure to check the unit price to see if this is true. If the largest size unit price is not that much cheaper consider staying with the smaller size as otherwise you may end up consuming more of the product than you where intending
Beware the product placement: in the shop the most visible product are not necessarily the cheapest, instead these are the products which have had the most paid for them by the brand owners to get visibility with you
A bargain is not always a bargain, super markets (as well as all other shops) will mark up their products then mark them down again so that they can say they are deeply discounted when really they are not if you consider their long term cost.
Don’t buy in bulk just because you get a discount: often the discount is very small, and you will end up consuming more than you intended and spending more money
Buy own brand or no brand stores tend to have different prices to differentiate the customer when in fact the product is exactly the same produced by the same manufacturer. So it is worth trying the own brands at least once to see if they are good enough, often times you can save 30% or more this way. The saving may not be great, but because these are products which you buy on a weekly basis the saving will add up.
Check over your receipts at the till: given the many items of food which is bought every week it is not surprising that mistakes are often made at the cash register, the most common being an item being double counted, so be sure to give your receipt a good once over and see that everything is in order
Write a list before you go shopping and stick to it. You need a very good idea of what you are going to buy before going into the store, otherwise you will end up getting more food than you wanted to. Do not put any items shopping cart if they are not on the list, you should save a significant amount.
Make your own lunch, don’t buy it as eating out for lunch every day can quickly add up, it does not take much preparation to make lunch, and when you cook you can always cook more than you need for one mean and have left overs on the next day.
When you cook, cook for 10, that way you can freeze the rest of it and have it later. Once you do this with a few different meals you will have a large selection and you will need to spend less time cooking, and need to spend less money outside buying food. This also allows you to buy ingredients in bulk that way you can save even more.
Get a large freezer or an extra freezer this will end up saving you time and money and will mean that you can cook greater quantities of food, and buy more in bulk and thus save more money. Another benefit is that you will have less times when you run out of food as you are able to keep stock levels higher, even if everyone decides they suddenly like one thing one week.

• Look through your bank statements for the past month and your receipts, to get an idea of what you spend money on.
• The monthly personal accounting spreadsheet has more categories to give you an example you can tailor it to your needs
• Keeping a record of where your money is going. Any large purchases or frequent purchases should be noted. Things you buy on a daily basis can quickly add up, for example if you spend just 5 dollars a day on coffee over the year that comes to over $1800.
• Aim to have as few unknown expenditures as possible
• Where possible and not too costly move yearly payments to being monthly, this will make budgeting on a monthly basis more easy and you can better see how much money you have left at the end of the year
• Consolidate providers for successful budgeting, where you have the option go with the same provide for example for gas and electricity, this will mean less bills to pay and will generally be cheaper
• Once you have a months worth of spending information you are ready to construct your budget from this.

Money saving tips with budgeting

• Each category is either an essential expenditure or non essential. Generally paying for heating would be considered essential while paying for going out would not.

Essential expenditure

• With respect to budgeting this boils down to shopping around for the best deal, when your auto insurance is up for renewal look for other providers
• If you have any outstanding loans then look to paying them of, ensuring that you pay of the loans with the highest interest rate first, it may even make sense to consolidate your loans into one loan as long as the new loan has a lower rate and the terms on the loan are not overly restrictive.
• Are there things in this list was are not actually essential? For example do your still need your land line? If you already have a cell phone you could do without the land line, this will help with your budgeting as you will have less bills to worry about.

Non essential expenditure

• In budgeting terms to cut down on non essential expenditure it is helpful to introduce a concept called marginal utility. This is the utility(usefulness or entertainment) gained from an increase in the amount available on that good or service. For example take two different leisure activities reading a book and going on a night out. Lets assume that reading a book for one hour gives the same entertainment as going out for one hour. Now we can work out which gives the best bang for your buck.
  Book (cost $10) time spent reading 10 hours.
  Going out (cost $50) time spent 5 hours.
  Book costs $1 per hour while going out is $10 per hour. So it is clear from this example (as long as both are equally enjoyable) it makes more sense to invest in the book than going out. Even in the case where going out is twice as entertaining as reading a book it still makes most sense to get the book.