One of the biggest keys to successful financial structure is to put in place a budget and stick to it.  A budget is the best way to get a grip on your spending and making sure that your money is being used in the way that you want it to be.  Life on a budget is a necessity and so if you haven’t been living on a budget, there is no time like the present to get started and the following information may be helpful in getting started.

Creating a budget generally requires taking the following three steps.

1.  You must track your spending to figure out your current spending patterns.  You can’t change what you don’t know about.

2.  You must evaluate your current spending and set goals to take into account not only your day to day living expenses, but also your long term financial goals.

3.  Continue to track your spending to make sure that it is within the guidelines that you have laid out for yourself.

PITFALLS TO WATCH OUT FOR

Cash leaks.  If you are spending money and you don’t know how much or where it went, then you have a leak.  In general, if you are well budgeted, then you should be able to predict how much cash you need to take for the week, and that should be it.  There should not be constant runs made to the ATM machine or bank, this shows that you are not budgeting effectively.

Spending More Than You Have.  This is a common problem in most households, but you really need to come up with a reasonable budget and then stick to it.  Overspending causes debt, and once debt takes over, it can be difficult if not impossible to overcome, so don’t fall into the trap of spending more than you make.

Don’t Confuse Luxuries With Necessities.  Understanding the difference can be the key to making a realistic budget.  Cable TV, cell phones, internet service and fast food, are not necessity items, even though many people try putting them in that category.  It is important to not try and fool yourself into thinking that you can’t live without these items.

Don’t Count On Windfalls.  When you are figuring out how much money you can live on, don’t include in your budget things like bonuses, tax refunds, or investment gains.  The extra money from such items may be nice, but shouldn’t be figured into your income.

Watch Out For Spending Creep.  This is what happens as you begin to make more money, you begin to spend more money.  You are much better off sticking to the same monthly budget and putting the extra income into your savings.

If you attempt to solve this problem using the lecture method, then you may just drive your spouse to spend more, thus resulting in more problems.

A more effective strategy to combat this problem is to keep track of household expenses.  Accountability for household expenses may be just enough to show your spouse the areas that need work, without really saying anything.

If this doesn’t work? Then the time has come to get separate bank accounts.  And if your spouse’s spending is causing extreme stress on your household finances, then you may have to consider stronger measures.

Finally, you might consider lightening up a little. Marriage is one of life’s great blessings. If you think the occasional iToy is expensive, wait until you see how much a divorce costs.

It may be a long haul for the American public, but we can all do our part.  Volunteer time, money or whatever resources you have to help others if you are not one of the one’s in need.  You could need help in the future, so keep in mind that what you put out there comes back to you ten fold.  We need to help each other, just like we did following 9/11.  We need to unite and show the world what American’s are made of, and it isn’t money.

I can’t imagine a world without banks and credit cards, but maybe that wouldn’t be so bad.  I guess we could barter, and return to a world where we actually had human relationships and where people had to be decent to each other in order to get the things they need.  What about all the others, the people who are completely unwilling to give up their lives of complete selfishness and greed.  Will they just steal to get what they want? Will they be able to survive this way, or will their greed just eat them up and spit them out? Will we? I don’t really claim to know how all this mess is going to pan out, but I do know that we can’t just continue to bail out companies and pretend like everything is okay.  They keep talking about a recession if they don’t bail out these companies, but isn’t this just a way of prolonging the inevitable and making things worse.  They say that we need to do this now, but what they aren’t saying is what will come of this debt down the road.  In my mind it is kind of the equivalent of floating a check or paying one credit card bill with another credit card.  The debt isn’t going away, it is just being transferred and it will eventually catch up with us and most likely when it does the results will be way worse than they will be if they let this catastrophe happen right now.

Pretending like everything is fine, will not and does not make everything fine.  These problems are not going away anytime soon, either way.  I am not sure what comes next but I am sure that we must be prepared for some major lifestyle changes or we will not survive it, of this I am almost certain.