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Starting and Sticking to a Budget: Step 1

Keep a Spending Log

These days, money is on everyone's minds.

You've got a little one on the way and you're trying to save money. You've got two kids and you want to be able to stay home or cut back your hours. You're trying to budget for day care, college savings and school trips.

Regardless of your situation, making and sticking to a budget is a great way to improve your family's financial fitness.

More than 40% of American families spend more money than they earn.  And more than 14% percent of our disposable income is spent on debt reduction these days, up from 13% in 2001. With fuel and food prices skyrocketing and the currency weakening, even "comfortable" middle-class families are feeling the pinch. What's more, less than half of all Americans use a budget, and about one in three don't know the interest rates on their credit cards, according to a survey for the National Foundation of Credit Counseling.

Despite all that gloomy news, it is possible to get out of debt and stay out of debt. How? By putting yourself on a "budget." As daunting as it may sound, making a budget is actually fairly easy. Think of it as a financial makeover--a lifestyle change that uses small steps to help you reach your goals. Sound familiar? It's the same proven system that BabyFit's healthy living programs are based on. Just as fad diets won't help you lose weight and keep it off, a strict financial "diet" doesn't work either! Getting out of debt, saving more, and just familiarizing yourself with your financial situation takes a little planning, some patience, and perseverance.

Here are five simple steps to making a budget (and sticking to it!)

1. Keep a spending log
For one month, write down everything you spend. (Our printable Spending Log makes it easy.) Keep track of all purchases, from the $3.25 you spend on a latte, to the $175 you pay for your son's school trip, to the mortgage and utility payments you make each month. Ask your partner and children to do the same. Even grade-school children can benefit from learning about managing money.

This task serves two purposes: 1) It holds you accountable for every purchase. 2) If you have to record each purchase, you will think twice before making impulse purchases.

When logging your purchases, make sure you're specific. If you write "$52.17 at Wal-Mart," that doesn't tell you what you bought. Pull out those receipts you usually ignore and break down the purchases. Soon, that $52.18 at Wal-Mart becomes $11.95 for health care, $33.24 on groceries, and $6.99 on education (school supplies for your daughter's science project). Write down the small stuff. Candy bars might cost just 65 cents, but if you buy three a week, that's $101.40 a year!
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About The Author

Stepfanie Romine
A former newspaper reporter, Stepfanie now writes about nutrition, health and fitness, with an emphasis on whole foods and from-scratch cooking. She is a certified Ashtanga yoga teacher who enjoys Spinning, international travel and vegetables of all kinds. See all of Stepfanie's articles.

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