Budgeting 101: A Guide to Creating Your First Budget.

   Creating a budget is your first step to controlling your finances and maintaining sanity in your financial life.  A budget can give you better control and the ability to micromanage your money in great detail, it also provides cash flow info for your home or business.  In many cases the solution to money problems might  be to find additional and new sources of income, but in some cases better budgeting might be all you need.  Budgeting mostly involves using lots of common sense but some points to remember when starting a budget are to

A) Create and Stick to the budget.
B) Keep the budget realistic.
C) Don't Panic over minor deviations.
D) Read up on budgeting and financial tips.

   Creating and Sticking to the budget

You can create your budget using various tools such as Microsoft office, quicken, budgeting workbooks, online worksheets etc.  After you've decided which tool works best for you, you'll need to create your budget based on your income and preferences.  Using templates or existing workbooks from some of the above budgeting tools makes it a lot easier since you have many recommendations, tables and formulas to use when budgeting.  Some useful percentages to consider are 60% of income towards housing ( Utilites, Rent, Mortgage etc), 10% towards savings, etc.

   Keep the budget realistic.

 You can't get blood from a turnip so realistically if there simply is far too little money coming in the door, budgeting can help but will likely not be as effective without an extra job or new sources of income.  You should avoid using credit if possible but instead set up an emergency fund or savings for unexpected expenses, any debts should be paid off asap.  Also be sure to set aside some money for recreation and entertainment since it will naturally be a part of your monthly expenses anyway.

   Don't Panic over minor deviations.

   Try not to lose too much sleep over some deviation in your budget and create and section of the budget to miscellanous expenses.  Creating a budget takes time and effort so naturally you can be concerned when you find yourself overspending despite the budget, remember though that it is a guide and sometimes life happens despite all the planning.  Having a budget will give you a good idea of you cashflow situation but sticking to it longterm without too much deviation will keep you informed of your finances.

Read up on budgeting and financial tips.

There is a wealth of budgeting information online in articles like this one, on blogs, financial sources like The Motley Fool, Dave Ramsey, The Wall Street Journal and much more.  By researching these sources you'll find the budgeting and financial tools and info that works best for your needs and style of money management.

Some Budget Tools

Windows Excel Templates
Quicken.Intuit.com