How to make a frugal budget work

One of the ways that I successfully manage our household income, is that I develop a budget that is within my means. 

1. Figure out how much your expenses are every month.

You should list every expense that you have every month including money spent on entertainment like going out to eat and hobbies, and also any credit card or other debt payments you make on a monthly basis.  

2. Figure out how much money you have coming in every month.

Figure out your monthly income including returns from investments or other sources of income, as well as your job. If you have a commission based job such as a my husband I use the last 12 month average.  

3. See how your earnings compare to your expenses.

You need to see how your current budget is working so take your earnings and subtract your expenses. The amount left is what you have after you pay all your bills.

4. Make your budget a frugal budget.

If you have more expenses than you do income, you should adjust your expenses until you have a little money left over at the end of the month.  You may need to cut out some extras.   Maybe you don't go out to eat every week or you may need to cut out the extra cable stations.

5. Make sure your frugal budget includes money to pay down debts.

If you are paying off debts by making minimum payments, you need to build up some extra in your frugal budget to pay more towards your debts every month. That may mean cutting some things out of your frugal budget to get the extra money to put towards debts.  Or if you have debt it maybe time to get a extra job.    My recommendations for paying off debt is credit card debt, car debt and then  student loans.  

6. Make sure you are saving money.

You also need to include savings in your frugal budget. Everyone should have an emergency fund of atleast 6-8 months. You may also want to save for retirement or for a vacation in the future. It is a good idea to write your goals down and then work towards saving for those goals. If you have debt, though,you should save a small emergency fund and then be aggressive on the  debt.  

7. Use this new budget to manage your money.

As soon as you get your new frugal budget all ready, you should start following it and see how it works out. As you implement your frugal budget, you may need to make small changes At the end of each month, look over your expenditures to see if they are matching up to your budget. If they aren’t, determin e if you need to work harder to stick to your spending plan; or if you need to rework your budget to reflect your actual spending.

There are different ways to make money but also there are many simple things you can do to save it and make Your life easier.