I started using an on-paper budget when I started losing bills and having to pay late fees for bills I had forgotten to pay on time. Some of the more spontaneous people I knew made fun of me ... until they found themselves in credit card debt with a wicked Target credit card bill coming every month.
Setting up a budget (either on a piece of paper or in Excel, which is how I do it because I like the calculations) has helped me to prioritize what I spend money on and we are never late with bill payments now.
It's easy to do. If you use a piece of paper, make column headings like "Name of Bill", "Total Amount Owed", "Amount Due Now", "Due Date", "Date Paid", "Amount Paid". You decide how you want to set it up.
Down the left side list your bills: rent or mortgage, utility bills, car payments, dance lessons, groceries, gas for your car, everything. Don't forget about those things that come every two or three months, like maybe your trash bill or if you pay your car insurance every 3 or 6 months.
Whip out your calculator because you may have to adjust some of your amounts that you spend on unnecessary stuff like fast food. If you are low on money for a certain paycheck, watch what you spend at the grocery store because that is the easiest place to cut costs. Shop at discount stores and consider some meatless meals like Frito Pie, grilled cheese or peanut butter and jelly.
Check back with your budget often to make sure you're on track. It will take some tweaking and a few months to perfect it, but soon you'll be on your way to financial success. Setting up a budget is especially important for couples who maybe aren't on the same page financially ... like one spends a lot and one prefers to save.
I also highly recommend any book by Dave Ramsey, as well as his radio talk show!
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