Creating a Budget You Can Live With!


Lonnie R. Mathews, Contributing Writer

Budgeting has gotten a bad reputation among those who like to spend. When most people think about having to budget they think about not being able to spend money freely. I have come to learn that budgeting really means freedom, freedom to choose how your money is going to be spent, and freedom to choose what you want to spend your money on. The only caveat is having a budget forces you to be honest with yourself about where your money is going.

Financial author Robert Kiyosaki said it best when he wrote:

“With each dollar that enters your hand you and only you have the power to determine your destiny. Spend it foolishly, you choose to be poor. Spend it on liabilities, you join the middle class. Invest in your mind and learn how to acquire assets and you will be choosing wealth as your goal and your future.”

When it comes to budgeting and creating a budget that you can live with, the first thing you have to do is be honest with yourself. The most difficult part of the budgeting process is following through; anyone can write numbers down on a sheet of paper, as the math part doesn’t require a lot of effort. It’s about conquering the desire to spend money on the things that are not part of your budget.

The budgeting process has three components that you must master in order to create a budget you can live with:

  • Your current income
  • Your current and future expenses
  • YOU

Your Income

In most cases when you think about the money you make, your income is your income. In other words, rarely do we have any choice about how much we bring in on any given payday (Unless of course you are in a sales position and can earn additional income by selling more). For the purpose of this article, we will assume that your income is the same each payday and you have little control over how it changes from payday to payday. That being the case, in order to create a budget that you can live with, you must first track your spending.

By tracking your spending you will get an idea of your current financial habits and where your money typically goes from payday to payday. Tracking your spending will require you to develop a habit that most people don’t have; so an easier way to get started developing a budget that you can live with would be to look back at your typical spending rather than tracking your spending going forward.

Grab the last two months of your bank statements and do a quick analysis. By doing this you can get an idea of how you spend your money, your tendencies of where you spend your money, and what’s important to you. When you analyze your bank statements pay special attention to a couple of days after each payday; it is usually during that time that most people tend to overspend and have very little accountability for what they spend their money on.

Current and Future Expenses

Since we have little control over our income unless we change careers and/or jobs, the most practical and easiest way to get your budget in line with where you would like for it to be would be to focus on current and future expenses. This is one of the two components of the budgeting process that we have the most control over.

To develop a budget that you can truly live with, you must take a good hard look at ALL of your current expenses, and make it a point to do a better job of managing your future expenses. The best way to manage where your income is going is to set and prioritize some financial goals. By setting financial goals you have the freedom to choose where your money will go going forward.

Setting financial goals is the key to creating a budget that you can live with. After looking at your current expenses spend a few moments and decide what areas you can make changes to help you accomplish your new financial goals. Afterwards, you must make a conscious effort to change the habits that would allow you to obtain your new financial goals.


The last component of developing a budget that you can live with is conquering yourself. Most people have it all wrong when they say “I have money problems.”  The truth is your money has a problem; and the problem is you.  It was once said that “In order to live, we must first conquer ourselves.”

Creating a budget that you can live with requires you to form a big picture of where you would like to be financially and develop goals to help you get there.  Decide today what a better financial future looks like for you, and then make the conscious effort to change your spending that will allow you to get there.

Lonnie R. Mathews wrote this article for the Who’s Minding Your Money blog. Lonnie is an author and speaker in the area of personal finance. To learn more about Lonnie or to contact him, please visit



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