Items you will need
- Spreadsheet program (such as Excel)
- Financial documents
Creating a budget control plan is one of the most effective ways to stick to spending goals. Learning where your money goes each month will help you create a realistic budget, while writing down actual spending on the plan sheet will keep you on your toes. Though you can download budget tracking templates online, it's fairly easy---and free---to create your own budget control plan with a spreadsheet program.
Find your average monthly spending by tracking all expenditures for the past two to 12 months. Gathering information from a full year is ideal, but if that's not realistic, aim for at least two months so you can create an average. Statements and receipts are a good place to start, but don't forget cash purchases.
Using a spreadsheet program (such as Excel), begin making a personalized budget sheet. In a new column, make a list of spending categories, including everything from mortgage and car payments to your gym membership and magazine subscriptions. (Alternatively, you can download a pre-made budget plan such as About.com's Basic Budget worksheet).
Start another column to the right and title it "Current Spending" (or a similar title of your choice). Using the information you gathered in Step 1, list the monthly averages that correspond to your expenditure categories. At the bottom of the column, total your average monthly spending.
Determine your average monthly income by totaling all earnings for the year and dividing by 12.
Compare your monthly income to your monthly expenses. Do expenditures exceed income? If so, you'll need to adjust your spending at least until they are even. Even if you find you are spending less than you earn, you may wish to cut back on expenditures, depending on your specific savings goals (if you aren't saving anything, 10 percent of each paycheck is a good place to start---though more is better).
Since some expenses will be fixed---such as the mortgage and garbage bill---look to discretionary (or luxury) costs first. Ask yourself how much you're willing to give up to save money. For instance, are you willing to carpool to cut gas costs? Can you pack your lunch instead of eating out? Estimate how much you can save by making changes, and write the amounts down in a new column titled "Budget." The difference between "Budget" and "Current Spending" will be your savings.
Use the columns to the right of the "Budget" column to track your future monthly expenditures (a column for January, February, March, etc). Continue to compare to your budget---adjusting if necessary---until you reach your spending goals.
If you determine your current spending by tracking a few months (as opposed to a full year), make sure that you add in any irregular expenses during the remainder of the year, such as car registration or Christmas gifts. Divide each irregular expense by 12 for a monthly average. You can alter the format of your budget plan to fit your needs. However, make sure your plan lists all of your expenses and includes space for goals and future spending. Keep accurate records of your spending to stay on track. You may wish to start a spending journal for tracking small cash purchases, which can be easily forgotten.