It’s harder to budget when you are in financial trouble, so the best time to start is in college or before college.

Budgeting can be very stressful to start when you are force to start because of a financial hardship. The good news is that anyone can learn to budget and budgeting can be customzied to fit each family - which is perhaps why it’s one of the best methods to manage your money.

Get a hold of you money - start a budget.

Agree with Curt, starting your budget earlier is better. This way, you’ll value money especially when you start working and the pressure of using your credit card to purchase unnecessary stuffs is unavoidable.

Sam
Fix My Personal Finance
http://fixmypersonalfinance.com

Money Ning,

I somewhat agree with your points. Just that sometimes I wonder whether the benefit outweight the costs and time spent trying to keep track of all expenditures.

It’s time consuming to track all manner of expenditures. Any ideas on what’s the fastest and best way to do this.

Not sure if you’ve blogged about this, but if you have, do let direct me to it.

I’ll wait for you to share your experience on this. I did track my expenses in the past but gave up since I couldn’t jot it down on a real time basis, especially with work and all.

Too lazy to do so at night, after work.

Maybe you could elaborate on how you managed to keep track of your expenses and the what type of software you use. Quick Books?

I for one am interested to see how this could be done effectively and efficiently.

Rgds

thanks for the reasons. I think they are not new for almost all of us

As someone who is already credit-card debt free, who saves (retirement, household, and emergency) a very substantial part of our income, and who pays extra on the few debts we have (mortgage and one car loan), I tend to agree with Avatar: I don’t see any need to track my spending in that level of detail when I already have painstakingly over the years learned to carefully evaluate each and every purchase. And when you say, “Even the most frugal person would splurge once in a while as long as he/she has the money to spend,” what’s the problem there?!? For example, as you can probably relate to, I’m getting married in a few weeks, just a small civil ceremony in California. We didn’t set some random budget figure, we just decided what we really needed and made good choices: My dress is only $130, my partner’s outfit comes to less than $100, we’re staying in a friends’ borrowed apartment, our few guests are paying for their own dinners since we did not want to pay for two receptions since we’re going to have a full religious ceremony next year, we chose a low-mid priced restaurant, and we’re not doing anything touristy that’s absurdly expensive. This is the reason why we put over $1000 a month into the account that’s used for house fixups and other things that aren’t part of the monthly budget (and this is on a combined salary that’s still just 5 figures).

That said, we use our debit card for pretty much all of our everyday purposes. I can then look at our statement and see how much we spend on groceries and household goods, how much we spend on gas, how much we spend on going out to eat, etc.

I know I’ve rambled too much, but I really do think that it’s not necessary for folks to track every purchase who are not in significant debt, if they are saving what they need to save, only spending spending money they HAVE after savings (not normally spending savings, or putting things on credit), and are evaluating every purchase. And if someone like that (like me) isn’t allowed to splurge every once in a while, then what’s the point?!? ::grin::

I don’t think enough of a distinction is being made here between budgeting and tracking expenses. For example, we budget for household expenses and minor splurges (going out to eat, for example), for three types of savings (retirement, house project, and emergency), to reduce our debts faster than the normal payments would allow, and to give us each a wee bit of pockeet/play money. We keep money for each of those things in separate account: A joint checking account for house hold bills, savings which serves as joint checking overdraft for bigger household purchases (mostly remodeling but also gifts and now a wedding), emergency and retirement savings accounts, and separate personal checking accounts for our individual play money. We have a pretty simply budget oversite process: When we run low on money in an account, we stop spending, we never spend emergency money except for true emergencies, and we never touch retirement for anything. I’m not going to micro-track our expenses since things change up and down all the time anyway. For example, we might have a bunch of clothing expenses one month then nothing for a years; our food expenses have gone up substantially both with the rising costs of food and with our choices to eat mostly locally and organically, but that just means we can’t/don’t go out to eat as much. It works out without recording every single receipt, mostly because we don’[t spend money we don’t have (credit) and we think about every purchase we make. Tracking every expense is needed to figure out how to get and stay out of debt, and how to save more money; it’s really not necessary when you’re already doing pretty darn good in those areas.

I agree that we should start tracking our finances for us to save for the rainy days.

Sorry Money Ning, I have to disagree with your budgeting post. Read more at

http://nocommunism.blogspot.com/2008/07/pissing-off-some-fellow-bloggers.html

I just don’t like doing budgets every month MN. Once upon a time i did a budget for 6 months straight, but after getting busy I stopped doing it for one year.. And decided not to proceed.. I think that being frugal and thinking about purchases on the want vs need psychology is more important than simply tracking your expenses. But then knowing your expenses is an important part of knowing how much you need to generate from dividends/passive income/..