Whether you've filed bankruptcy or not, if thinking about your finances causes you stress, or if your expenses exceed your income, the most important thing you can do for yourself is create a realistic budget and stick to it.
Although creating and sticking to a budget can seem like a daunting task, it actually can be accomplished with a few easy steps.
The first step in creating a budget is determining what you spend during the course of the month.
For at least a full month, carry a small notebook around with you and record every purchase you make.
This is especially true for small purchases as it is for big ones. Spending $8 on a pack of cigarettes or $4 on coffee every morning can add up to big money by the end of the month. Tracking your spending will help you keep determine where your money goes.
Next, write down your fixed expenses for the month: rent or mortgage payments, car payments, insurance payments. Also, think ahead and include annual or semi-annual expenses, like taxes, car registration, and even a rough estimate of holiday expenses.
Once you have your expenses figured out, total up your monthly net (after taxes) income. Make sure to include all your sources of income: any full-time or part-time work, child support or pension payments.
Finally, start writing your budget.
To budget properly your income must always exceed your expenses, or you will be losing money right from the start!
Start by creating categories of expenses, including home and utilities, entertainment, child care, food, clothing, health care, transportation, education and savings.
Budgeting money for savings is important, but it's also important to give yourself an entertainment budget, too. If you don't budget yourself for things you truly enjoy, maintaining the budget will seem like a huge, insurmountable task.
Once you've established the categories of your budget, use the data you've gathered through your bills and daily expenses to come up with 'projected' monthly expenses in each category. Add up all the totals and enter them into a 'total expenses' category.
Compare that to your 'projected income' category, and figure out the difference. Remember, your expenses must always be less than your income, so if your expenses exceed your income, you'll have to find areas in which you can cut back.
Most importantly, if you decide to cut back in a certain category, you must actually follow through with the commitment you put down on paper.
Make sure that you accurately record your expenses every month, and compare them with the projections you budgeted for yourself. However, don't consider your budget to be something that cannot be altered once it is written.
If you see that you're spending $100 a month at the movies and had only budgeted $50, see if you can increase your monthly allotment by reducing one of your other budget categories by $50. Or, see if you can reduce your spending from $100 to $75, and trim $25 from somewhere else.
By creating a realistic budget and sticking to it, you should be able to eliminate some of your financial headaches. In fact, you'll soon find that saving money is easier and you hardly miss some things that you gave up that you initially didn't think you could live without.