No matter what the status of the economy is, most of has to live within a budget.

Make a list of all your basic need costs.  Basic needs are things you can not live without.  Some of these costs are:

• Rent or mortgage payments.
• Food (what you spend on food you make at home).
• Utilities (heat, water, electric, air conditioning).
• Phone bill (home phone or cell phone).
• Cable bill.
• Car payments.
• Car insurance.
• Student loan payments.
• Any other loan payments.
• Credit Card Payments.
• Child support or alimony.

You can add or subtract any of these items from your list.  The whole point to having a list of your bills, is to be able to make a budget you can live on.

Once you have your list made, add up all your bills, and then divide by four.  This is the amount you will have to set aside from your pay check each week.  If you already have a checking account, it is a good idea to open a separate “secondary” checking account.  When you get paid, transfer the exact amount you need for your bills into your account as soon you get your pay check.  Pay all your bills from the same account, and know you will always have sufficient funds.

Living within a budget can take some getting used to if you have never had to worry about one before.  Once you get used to living within a budget, you will forget you ever lived any other way.

Here is the list of five budget leaks, which could ruin your budget if they are not fixed correctly and at the right moment:

Food: if you spend more money on food than you planed for, it means that you dine out too often. In fact, a dinner in any restaurant is approximately five times more expensive than a dinner at home. Try to dine out less often when you are on a tight budget – like once a month.

Another reason for spending on food too much is to buy groceries in a wrong way. The better way to buy groceries is to:

• Shop with a list: remember to stick to you list and buy only important products and goods at the right period of time.

• Don’t shop hungry: it’s that simple if you are hungry you tend to buy more products, which most of the time you will not be able to consume.

• Shop alone: the more people are shopping with you the more products you tend to buy and thus try to shop alone.

Retail shopping: is another aspect of your budget, you spend more than intended too. The number one reason for overspending in retail shopping is buying too much. Therefore, buy only what you want and what you need.

Entertainment: people often spend more money on entertainment than anything else because it’s hard to plan how much money you will spend on fun this month. What you need to do is to set money aside for entertainment each month. Once entertaiment money are gone you need to wait for the next month to have some fun. By the way, there are a lot of ways to have fun for free. Check your local newspapers, magazines, portals for more details.

Kids: it’s obviously hard to live with kids on a tight budget. But what you should do is teach them financial responsibility and the right moment and age.

ATM: the best way to eliminate extra expenses is simply to leave your debit cards home as often as possible and on live cash basis.

The main idea behind budgeting is to stop acquiring new debt and spend money on things you really want and need.

So, here are three strategies to make your budget work:

• Direct deposits: your bank account is always the best way to save you money. Actually banks help you to earn money because one dollar saved is one dollar earned. On the other hand, saving money under your mattress is not the best alternative because your home can be burnt or burglarized.

• Convenience: find a financial institution, that is very incontinence to use. A bank on the other side of the town would be the best choice for you. Always remember that the less convenience it’s to get and spend money the less money you will spend.

• Save change: try to spend only paper money and save change aside. You will be amazed regards how much you could earn by doing so.

Many consider budgets like diets: they never work and in the end you are worse off than when you started. However, if a budget is formulated and implemented properly then it works well.

The better and smarter way to create a budget is first to track your expenses and then make a budget. This practice would insure that your budget is reasonable and attainable. So first off, you need to track your expenses.

There are various ways to track your expenses. But the most promising and useful ones are to:

• Utilize different computer softwares.

• Use a day planner.

• Keep all receipts.

Budgets don’t work most of the time because people spend too much on wants rather than needs. As you all know, a need is crucial for human survival while a want is considered to be a luxury. The best way to determine if a need is a want is to ask yourself this question: “How did I live without this product or service before?”

There are various budget guidelines, which demonstrably justify how much you should spend and on what. Sample budget guideline is:

• Housing: 30% – 40%

• Utilities: 7% – 14%

• Food: 10% – 20%

• Transportation: 15%-26%

• Medical: 10%-15%

• Clothing: 2%-5%

• Savings: 5%-10%

Finally, now when you have tracked your spending behavior for a period of time you are ready to develop a budget!