Implement a "Game" Mentality

Now that you have a goal to strive for, a list of variable bills to lower, and an understanding as to why it's important to compare cost, risks, and benefits before making a purchase, you're now ready to CHALLENGE yourself to succeed.
Are you wondering how you are supposed to CHALLENGE yourself?
Take for example a track runner/sprinter who is able to run the 100m sprint in 10.6 seconds. What do you think this runner will do next? He/She will CHALLENGE themselves to beat that 10.6 time the next sprint.
Point is, this runner is constantly pushing him or herself to do better. The CHALLENGE is to strive for a faster time each and every time they run the 100m sprint.
Same thing applies to your money saving efforts. You will want to CHALLENGE yourself to beat the amount you can save each and every month.
When you CHALLENGE yourself to save as much as possible, you inspire yourself to succeed. Since you are faced with this "CHALLENGE" you'll start thinking "Hey, if I was able to save $75 this month, there's no reason why I couldn't save $85 next month."
For example, if you were able to save $84 in October, your goal for November is to beat that amount. In other words, save more than $84 in the month of November.

Name Your Game

Once you are ready to challenge yourself, try and think of this whole process as one big, giant GAME. You can name this GAME whatever you want, but try and incorporate your GOAL into the name of this budgeting GAME.
For example - "Hawaii, Here We Come""Chevy Silverado Savings""Our Family Trip To Vegas"
As with any game, the object is to have fun and win.
Thinking of these money saving exercises as a game will both inspire you and help you take your mind off the whole saving process. More importantly, this game can help you get your whole family involved without having to beg and plead with them to help. Remember, children L - O - V - E games!
Make a colorful chart or illustrated graph on which you can track your savings total. You can then post it in a location where your family can look and see their progress whenever they want.
GET CREATIVE and HAVE FUN with your money saving goals. The more pleasant and enjoyable you make this project for you and your family, the more likely you'll be to follow through with your plan and ACTUALLY be successful.

Conclusion

Implementing a "game" mentality will not only help alleviate any stress or fear you may have regarding this whole process, but it will make saving money much more enjoyable to do. Who doesn't like to play games?
Not only will a game make your agenda much more appealing, but it will kickstart your competitive spirit and CHALLENGE you to do your best.

Weighing the Cost, Risks, and Benefits

In addition to lowering your monthly bills and expenditures, you need to look at your shopping/spending habits and determine if any changes need to be made.
This is extremely important for a number of reasons. Basically, how helpful would it be if you took time to research and implement effective money saving tips, then went out and needlessly spent $200 on stuff you really didn't need? You would have done all that hard work for nothing.
This is why it is important to not only lower your monthly expenses, but to also adopt the mind set that before a single dollar is spent on anything, weigh the cost, risk and benefits they will have on your budgeting efforts.

Cost - Risks - Benefits

What does that mean - cost, risks and benefits?
Basically, this is a shopping mentality most frugal and conscientious individuals maintain WHENEVER they are faced with the choice to buy, or not to buy (the question every shopper should address before spending their hard earned money).
Think of this as a ritual you follow prior to purchasing ANYTHING. From the smallest trinket, to the most expensive gadget, get into the habit of comparing the COST - RISK - BENEFIT, before you spend a single dollar.
Regardless of how much it costs, get used to comparing these three important factors. For smaller, inexpensive purchases, you can simply weigh the pros and cons in your head. For larger, more expensive purchases, you should write down the benefits and consequences and discuss it with significant others in your family.

Cost

First of all, the COST of the item/product you are thinking about purchasing. Is it reasonable? Will buying this product put a major dent into your spending allowance? Can you afford to purchase this product without having to change any spending/living habits?
Get used to questioning the cost of every purchase. Ask yourself questions such as - would it be better to wait for a sale or markdown? What about buying the item/product used or borrowing from friends?

Risk(s)

What is the RISK to you and your family if you do decide to purchase a particular product? In other words, how will it affect your lives?
For example, if you were to purchase a new $30,000 car, what effect would that have on you, your significant-other, your children, etc? Will you have to work more hours in order to get by? Will you have to cut back in other spending areas to afford this new payment? Will this added expense keep you from paying your other monthly bills with ease?
There are always RISKS to consider whenever you purchase something, especially when you purchase something with an expensive price tag. Many times we overlook these RISKS and simply buy without thinking about all the possible consequences. Keep this in mind and you'll avoid putting yourself and your family at RISK!

Benefit(s)

In addition to the risks associated with any new purchase, there are also some benefits to consider. At least there should be some benefits or you shouldn't even be thinking about buying it. In short, how will this product benefit you and your family? Do the benefits outweigh the risks?
To put this into perspective, imagine a large scale. The Item/Cost is in the middle of the scale, and on each side are balances. One side has the RISKS, the other side has the BENEFITS.
If you find that the BENEFITS outweigh the RISKS, then you know that the purchase is reasonable and will BENEFIT you and your family. On the other hand, if the RISKS outweigh the BENEFITS, then you may want to consider not buying that particular item. Why put you and your family at RISK if it's not going to benefit them?
Make it a habit to always compare the RISKS with the BENEFITS before buying. Not only will you find yourself becoming a more wise, careful shopper, you'll find this to be an excellent money-saving opportunity to help you in achieving your goal.

Eliminate Unnecessary Spending

You'll find that one of the easiest ways to come up with additional money is to first put an end to all the needless spending.
I'm sure you are all familiar with this concept. Every single one of us has been guilty of wasteful spending at one time or another in our lives.
For example, have you ever walked into a store just to "look around" and ended up spending $50+ on stuff you didn't plan on buying?
Or how about the five or ten dollars spent on junk food and impulse buys at the supermarket? It may not seem like much at the time, but that money adds up to a rather hefty bill over time.
These are examples of the types of spending habits you want to try and rid yourself of, especially since you are striving towards the GOAL you decided on a while back. Refining this approach, you can start directly eliminating unnecessary spending with most, if not all of your monthly variable expenses.

Where To Begin

Now that you have a list of all your monthly expenses and have singled out five of the most excessive bills, it is time to start eliminating unnecessary spending in these five areas.
When you start tackling your expenditures on an individual basis, adopt the mind set that EVERY dollar is important and valuable to your personal goal. Five or ten dollars may not seem like much to save off one bill per month, but if you multiply that by all your bills, over the course of a year you get a much more substantial figure.
You may soon find yourself saving an extra one or two hundred dollars a month just by eliminating excessive and unnecessary spending from your monthly expenses. And the best part is that you did not have to get another job. You did not have to work overtime or additional days at your current job. All you did was tackle each individual monthly expense with creative, yet effective, money-saving techniques.
Since you have already singled out the five bills that seem to be the most excessive, you have a specific starting point. Remember, there's no need to overwhelm yourself by trying to lower all your monthly bills at once. Not only will you burn yourself out, but you won't maximize your savings potential with each individual bill.

Finding Effective Money Saving Tips

In order to lower your bills to their lowest possible amounts, you will need to devote some time to research and find tips specifically designed for each particular bill.
For example, if you are trying to lower your household electric bill, you would want to search the Internet, contact your electric provider or visit their website (ie: sce.com), check out the local public library or maybe even a bookstore for any sources providing useful, relative tips.

• Once finished researching, you will have a list of all the tips you plan on implementing similar to this:


• Change to lower wattage/energy efficient light bulbs


• Install ceiling fans (reduce AC & circulate hot air)


• Lower temperature on water heater & refrigerator


• Insulate attic area and access panels


• Seal & caulk ALL air leaks


• ALWAYS turn off appliances when not in use (ie: TV)


• Install outdoor window shades to help cool the house


• etc...

Expense Tracking

Now that you have a specific money-saving goal to strive towards, it's time to dive into the process of lowering your monthly bills and expenditures.
Obviously, a choice you have is to work "overtime" hours at your current place of employment, or get a "second" job for additional income. For the record, the following process we will divulge does not look at this opportunity.
Hence, the agenda from this point forward will be to analyze all your expenditures, and lower the monthly amounts of each bill one by one in order to save the difference.

Where To Begin

To come up with extra money, or to generate a substantial increase in your monthly savings, you MUST first find out where you are spending the money you earn.
Everyone's individual saving potential is unique, varying anywhere from $10-$1500+ a month. Since incomes and monthly expenses differ for literally every household, it is impossible to set a standardized target everyone can achieve.
Point is, regardless of how much money you make per month, it is imperative that you find out how much money you are spending per month, and even more specifically, how much you spend on each specific bill/expenditure.
The degree of accuracy you put towards this task is up to you as always, but at some point you will need to list out all your monthly expenses. To put your mind at ease, you don't need to spend hours upon hours calculating averages and compiling data for the past decade. You simply need to list out each and every expense you pay per month, and the most accurate estimations for each particular expense.

Here are some of the most common monthly bills found in most households:

Electricity
Mortgage
Car Payment
Food
Clothing
Insurance(s)
Home Telephone
Gasoline
School
Dining Out
Pets
Water
Gas (home)
School
Pets
Water
Internet (ISP)
Home Cable
Entertainment
Cellular Phone
Miscellaneous

If you have the most current statements handy, then by all means use the exact amounts, however try not to let this exercise consume more than an hour of your time. This is not meant to depress you, or criticize your spending habits. It is merely a list to help provide you with a "bird's eye view" of how and where you spend your money.

Now That You Have Your List

We all have some spending habits that may be a bit excessive, or untamed. You may have even surprised yourself as you were making your list of expenses and had to double check to see if you were writing the correct amount. That's ok! Think of it this way, it will only get better from here on out.
Our goal now, is to eliminate all the excessive, unnecessary spending on as many monthly bills as possible.
Using your list of bills/expenditures, go through and highlight or underline FIVE of the bills that seem to be the most excessive. In other words, you are looking for five of your bills that you can immediately tell are unattractively absurd.
These are the five bills you will want to tackle first since they are the most extreme and will probably be the easiest to lower.

Declare your Money-Saving Goals

Now that you are 100% sure in your decision to effectively save more money, the next step is to decide on a specific goal you want to achieve.
The purpose of establishing a money saving goal is that it allows you to strive for a tangible reward you have wanted for some time, but maybe never had the money to purchase.
A money-saving goal will keep you focused on the task at hand and help guarantee your success. If you find yourself wavering from your agenda, keeping your end reward in mind will get you back on track, urging you to continue on.

Which GOAL Is Right For You?

The goal you select does not need to be above a certain price, or take you twenty years to acquire. However, it should be something that you REALLY want. For instance, if you have always wanted to vacation in Hawaii, but never had the "spare" money to accommodate this excursion, then this may be a goal to set for yourself.
If you have your mind set on a new entertainment center for your living room such as a 60" flat panel, wall mountable, digitally enhanced television, complete with a superior, top-of-the-line audio system, then this may be the money saving goal for you.
In addition to these types of goals, you may want to bypass the "short-term" rewards and strive towards a long-term goal such as securing retirement, a vacation home, or building a six-digit savings account. Again, this decision is entirely up to you, however keep in mind that it may be a good idea to first start off with a short-term goal in order to get rewarded from your efforts in a relatively short amount of time. Then afterwards, once you are more accustomed to this money-saving process, you can move on to a long-term, more elaborate goal.
As soon as you decide on a specific goal to strive towards, put a picture of it up on the wall in your room or in a highly visible area so you will be constantly reminded of your reason for saving money. The visual stimulation alone will help keep you inspired to succeed and hopefully prevent you from giving up on this important endeavor.
In addition to posting a picture of your goal, get creative and make a chart or graph to track your progress. Designing some type of tracking system will not only keep you motivated, but provide you with the exact amount you have already saved, and how much is still needed. You may also find that tracking your progress will allow you to see what techniques are paying off, and let you compare savings totals month to month which should hopefully be increasing as you go along.

Do you REALLY Want to Save Money?

Asking the question if you really want to save more money may seem a little absurd, especially since everyone probably wants to increase their savings account and have more money to spend. Less debt and more savings sounds like the best of both worlds, right?

The reason I'm asking if you REALLY want to save more money is to assist you in determining how sincere and motivated you are towards this upcoming endeavor.

Sure it's easy to proclaim your desire to save more money. That's the simple part. Anyone can shout out "I'm going to save more money!" or "I'm going to lose 40 pounds!" or "I want to be a millionaire!"

Where was the difficulty in making those statements?

Simply vocalizing your intentions is one thing however actually accomplishing these tasks is a completely different story and here's where my question comes into play: Do you REALLY want to save more money?

If you are able to answer with a confident, definite YES, congratulations! You have taken the first step in accomplishing this intimidating task.

Granted this is probably the easiest part of the entire budgeting process, nevertheless the role it plays in your effort is crucial. Put it this way, without fully committing yourself to this task, how can you expect to have any success? You won't, and your efforts will be short lived. This is something you definitely do not want to happen.

Over the next week, take the time to decide if you are truly ready to effectively tackle the money saving process. Remember, this exercise will be like any other hobby or new undertaking. You will need to put some time and energy into this task in order to be successful.
Just as you can't learn to play the piano or learn how to paint without putting the time in to practice, same goes for the money-saving process. Remember that in order to reach your financial goals, you will need to devote some serious time to accomplish what you are seeking.

Granted the amount of time you'll need all depends on the degree of importance this plays in your life. Still understand that success comes only after devotion to the task.

Hopefully this has helped you come to realize that budgeting and saving are serious tasks that are vital to your family's financial future. It is now time to prepare yourself to accomplish this extremely important task.

8 Steps to Save Money

• Do you really want to save?
• Declare your goals
• Expense tracking
• Eliminate unnecessary spending
• Weighing the benefits
• Implement a Game
• The three R's
• Track your results

Free Budget Worksheets

These free budgeting worksheets are in high quality PDF format so that you can easily print them. Because these budget worksheets are high quality the file sizes are large, so it may take a few minutes to download. Please be patient. You will need the free Adobe Acrobat Reader to view these files.

There's a Better Way!

Manually tracking your finances using paper worksheets like the ones above can be a difficult and time consuming task. Luckily, there is a revolutionary new modern method to track your spending and manage your finances. Mvelopes Personal modernizes the budgeting concepts used in the budgeting worksheets above by using advanced Internet technology. You can now manage your finances in just a few minutes a week allowing you to get out of debt and save for the future. Mvelopes will give you the peace of mind to spend with confidence, knowing the money is set aside for each expense.

Has Microsoft® Money Helped You Become Better Off Financially?

I tried to get started using Microsoft Money several times. But after getting it going I found that it just didn't really help my finances. Most people find they are not better off after using Quicken. In spite of all that Money does it does not solve the fundamental problem that keeps most people from achieving their financial goals, and that is managing their spending. The key is budgeting, but not the traditional approach. Money uses the traditional after-the-fact approach, basically a month-end reconciliation of budget to actual spending, which simply does not work. Imagine trying to manage your grocery or clothing spending but not knowing how much you have spent in each until the end of the month. It just doesn't work. You need accurate, up-to-date information for each spending category right when you make a spending decision. You cannot wait until the end of the month.

Something New!

I found a great option to using MS Money to manage my personal finances. It is called Mvelopes Personal. Mvelopes Personal allows you to easily create a budget with dynamic spending accounts that provide you with daily, up-to-date balance information for each spending category. You always know how much money you have left to spend in each category, and how long it has to last. You can then begin to manage your spending, and lay the foundation for reaching your financial goals. Take a look at the following key feature differences that make Mvelopes different.

Has Quicken® Helped You Become Better Off Financially?

As an experienced Quicken user I found that it didn't really make a difference to my finances. Most people find they are not better off after using Quicken. In spite of all that Quicken does it does not solve the fundamental problem that keeps most people from achieving their financial goals, and that is managing their spending. The key is budgeting, but not the traditional approach. Quicken® uses the traditional after-the-fact approach, basically a month-end reconciliation of budget to actual spending, which simply does not work. Imagine trying to manage your grocery or clothing spending but not knowing how much you have spent in each until the end of the month. It just doesn't work. You need accurate, up-to-date information for each spending category right when you make a spending decision. You cannot wait until the end of the month.

Something New!

I found a great option to using Quicken to manage my personal finances. It is called Mvelopes Personal. Mvelopes Personal allows you to easily create a budget with dynamic spending accounts that provide you with daily, up-to-date balance information for each spending category. You always know how much money you have left to spend in each category, and how long it has to last. You can then begin to manage your spending, and lay the foundation for reaching your financial goals. Take a look at the following key feature differences that make Mvelopes different.

Personal Finance Software is Money Magic by Kristen N. Carpenter

Does your money seem to pull a disappearing act each month? Does your credit card statement continually leave you wondering when and how you could have spent that much? What about that cash you took out from the ATM the other day – could you possibly have spent it already?

Let's face it. Managing your personal finances can be a difficult task – especially when on a tight budget. Every time you turn around, there's another bill to pay, and before you know it, your entire paycheck has been spent – and then some! Soon, you find yourself drowning in the financial demands of everyday life, and the vicious cycle of living paycheck to paycheck – or worse yet, living on credit – has begun. You ask yourself, "How did this happen to me?"

If you are finding it increasingly difficult to juggle the many different financial aspects of your life, you are not alone. The fact is, in today's modern society, the average consumer is forced to allocate the money from one stream of income to more than 30 different sources! From mortgage payments and health insurance to childcare services and credit cards, it's no wonder money appears to continually vanish before our eyes. But what if there was a way of reducing the invisibility of your spending? A way of budgeting yourself in a simple, pain-free manner and achieving that so-called state of "financial freedom" once and for all? Thankfully, where there is a will, there is a way.

I found a great personal finance software program called Mvelopes Personal.Mvelopes Personal is the new affordable and easy-to use online budgeting system sweeping the world of personal finance, is the answer to all your budgeting woes. Mvelopes' unique budgeting concept offers a straightforward method to reining in your finances, enabling you to spend less and spend more efficiently while still enjoying what matters most to you in life.

Gone are the days of discovering how much you have spent after it's too late to do anything about it. Instead, Mvelopes enables you to take control of your finances now by tracking the current balances within each of your designated financial software envelopes as you are doing the spending. In this manner, at the click of a button you will know exactly how many of your allocated dollars have been spent from each of your envelopes, thus leaving yourself better equipped to avoid going over your limit.

This real-time money tracking is made possible through a transaction download service, which is just one component of the Mvelopes Personal Budgeting system. Add to that the optional bill pay service, the financial portfolio management service and the outstanding free budget coaching all included in the package as well, and the result is your number one source for assistance in managing your personal budget.
Isn't it about time YOU took control of your finances and embarked upon the path towards financial freedom?
To learn more about how Mvelopes can help you to start making better spending decisions, or to sign on right away for your one month free trial offer, visit the Mvelopes homepage at http://www.mvelopes.com/index.php?cpn=knc-2qx979870772&accessCode=D001002003.

What Kind of Budget Planner are You?

There are a few different types of planners when it comes to managing budgets. The invisible planner neglects to track, manage, or take the time to update the budget. This planner seems to think if you create a budget it will take care of finances for you. All by itself. The passive planner takes a look at the budget on occasion but, really doesn't bother to take action when the figures don't add up? You might be a passive planner if you think that your budget will fix itself. Gee, these are two really great budgets, where do I get one? The efficient planner seeks to keep the budget alive and well. This planner has a realistic view of budgeting. So how do you become the efficient budget planner?

Set realistic expectations for yourself. We all want to be efficient budget planners. However, sometimes we make it hard on ourselves to achieve efficient budgeting. Many people set unrealistic budgeting goals and set themselves up for defeat from the start. Being more realistic with budgeting methods and figures can be easier and prove to be more efficient. If you're an invisible or passive budgeting planner, seek out the most efficient budgeting tools that meet your needs. The easier you make it on yourself, the more likely you are to follow through with budgeting tasks like budget tracking, updating, and maintaining.

Set realistic amounts for budget expenses. If you traditionally spend $500 on food each month, don't try to make your budget balance by decreasing the amount to $300. That is of course unless, you intend to actively use some money saving strategies to meet that goal. If $300 is a realistic goal, then go for it by all means. Follow this concept with all your expenses. Set realistic goals based on past spending. Then, if income and expenses don't balance, you can reduce spending in categories that you can (and will) most realistically make an effort to reduce.
Set realistic goals. If you have a huge debt payment, you're likely not to have the funds for savings until you eliminate debt. Plan to manage and eliminate debt first, then apply those freed up funds to savings and investment goals. Planning your goals to be achieved in a logical, realistic, time period and order will increase your chances of success at overall budget planning. Be sure to designate short and long term goals accordingly.

Budgeting is all about being real. Getting a real grasp on your finances. Being true to yourself and your financial needs is essential to your budget planning success. Don't plan a high finance budget on a moderate finance income. Be real with yourself. Everyone is different and has different financial goals and needs. Decide what you need to survive and be happy. What are you willing to realistically give up, or cut to the minimum, to make your budget plan work? Don't expect yourself to make major lifestyle and personality changes to suit your budget plan. Especially, if you've tried this in the past and failed. Instead, when planning your budget, create a realistic plan that suits your individual needs and personality. You'll be more likely to stick to it and succeed at achieving your financial goals.

Budget Percentages by Nattie Gilbert

I was recently emailed asking me what I recommended for budget percentages. Since I didn't know what our budget percentages are, I couldn't answer. I decided to investigate what ours were and what other people recommended.

Our Budget

Taxes 7%
Housing 33%
Auto (payment, insurance) 19.5%
Savings and Investment 7%
Medical and Life Insurance 2.5%
Food 21%
Misc. (clothing, toiletries, recreation, gifts, allowances, etc.) 10%

After investigating other sources, I discovered that we were similar. We are higher in some categories and lower in others.

Consumer Credit Counseling Service

Housing 20-30%
Utilities 4-7%
Food 15-20%
Transportation 6-20%
Medical 2-8%
Clothing 2-4%
Invest/Savings 5-10%
Debt Payments 15-20%
Misc. 5-10%

Bare Bones Budget from National Fdn for Consumer Credit

Housing 24%
Food 14%
Health 6%
Clothing 6%
Transportation 17%
Entertainment 5%
Personal Insurance 11%
Charity 4%
Savings and Other 13%

Budget Example

Savings 5%
Food 18%
Transportation 12%
Clothing 9%
Medical 6%
Recreation 5%
Housing (including utilities, furniture, and operating expenses)27%
Other 18%

If every budget example is different, then how do you know what to do. First there are some basic recommendations.

1. Save or invest at least 5%.
2. Debt payments shouldn't exceed 15%.
3. Mortgage companies want house payment to be no morethan 25%. Housing or rent costs should be kept within your means. We struggle in our area due to booming economy and high rents.

There are a few basic steps in order to set up a viable budget.

All budgets should be specific to your needs and goals. There is no set amount that works for everyone.

Make sure that you set realistic amounts. It's unrealistic to take on another loan that would cut your allotted food expenses in half when you're already struggling to stay within your budget.
Treat savings used for goals and emergencies as a bill. If you wait to save what's leftover at the end, there will never be anything left over.

Involve your family members. Spousal cooperation is necessary for any budget plan to succeed. I let my children participate in our budget discussions. Since I started doing this, my children understand money better. They are less likely to whine when they can't get something. They are also proactive in our frugal goals, especially when they know if we spend less on food there is more for fun. I also hope that they won't struggle like my husband and I did to learn to budget as adults.

Track, track, track. I truly hate this part and it makes me feel obsessive. But if you don't track, you won't know exactly where your money goes and where you need to focus. How you track depends on your personality. Computer programs like Quicken and Mvelopes Personal work great for some people, but not us. We need something quick, easy, and accessible to each of us. Therefore we use a notebook with lines for categories. All discretionary expenditures are listed in like categories such as food, recreation, and gas. We total them every day to see where we are. I've discovered if I compare budgeting to dishes (daily) instead of spring cleaning (yearly), I have much more success.

Refrain from impulse buying. "Oh sure," you say. If I could o that, I wouldn't even be reading this. I have a confession, I impulse shop, too. I believe most people do. The key is to find out why, what are your weaknesses and is there another way to satisfy your need or overcome your weakness. I often impulse shop when I feel ugly (which usually coincides with PMS). After analyzing this tendency and realizing that I probably can't overcome the feeling, I've brainstormed other ways to feel prettier than buying something. Treating myself to a bubble bath, good book and soft music satisfies the need to feel pampered and pretty without spending money. If you track your expenditures for at least 3 months, you will be able to see your weak spots. Then you can begin to overcome them.

Budgeting requires a commitment to ongoing tracking, analysis and implementation of frugal alternatives. A successful budget doesn't happen without hard work and time.
Gary Forman of the Dollar Stretcher explains why budgets fail. "When you analyze it, there are really three reasons why people are unsuccessful in budgeting. The most common causes of failure are unrealistic goals, quitting too soon, and misunderstanding what a budget really is."