If you have tried making a budget but have never had any success then chances are you did not make an accurate budget.  Any budget that is not based in reality will never work.  If you were constantly breaking your budget then chances are you did not make an accurate budget.

Start by building a money diary.  Write down every penny that you spend all day.  This includes the postage stamp that you bought for that letter.  It is important that you write down absolutely everything.  If you did not do this before you have found why your first budget didn’t work.  The money diary needs to be done for everyone in the family.  If you give your children a weekly allowance than just write that down.

Do not do anything differently then you have been doing just make sure that you write everything down.  Doing this for at least two weeks will give you an accurate picture of where your money is going.  You might be surprised where some of your money is going.  I found that my wife and I were spending 20 to 30 dollars per week on gourmet coffee.  That was between 80 and 150 dollars per month.  We determined that we could use that money to reduce our debt.  We still treated ourselves to coffee but we only did that once a month.  We were putting 70 to 140 dollars a month to reducing our credit card debt.

We also found several other things that we were able to redirect our money to.  This helped us stay on track with our budget and hopefully can help you.  The money diary is a critical step in building a successful budget.  Reducing your debt and building your savings account should be your primary goals with the budget.  This will help you improve your credit and your credit score.  Good credit is very important in today’s economy so maintaining your budget and keeping on track is crucial.

During these tough economic times, many Americans have seen major downturns in their savings, their retirement accounts and cost of living.  So do you know where your money has gone?  Maybe it is time to check where your money is going.

The best way to do this is to start with your budget.  If you don’t use a budget maybe it is time to start.  Begin by making a money diary that will show your complete spending for at least two weeks.  It is better to do a money diary for one full month but two weeks will give you a pretty good understanding.  This money diary will help you know where your money is going.  Then you can build a budget that will help you pay all your bills, save a little money and maybe even have some fun.

Once you have your budget built then take the time to check out your debt.  Start with your revolving credit such as credit cards, department store cards and gasoline cards.  Most gasoline card require that you pay the balance in full at the end of the month.  But if you have a card that you carry a balance on make sure your balance due is at least 30% or below of your available credit.  If you have any card debt that is carrying more than 30% then you need to reduce that debt as quickly as possible.  Once your debt is below 30% your credit will begin to see improved credit scores.

Now you have a budget and you have reduced your revolving credit debt it is time to start building your savings or emergency fund.  You should have at least three to six months worth of living expenses in your fund.  If you have a two income family then your fund should reflect that amount.  No one expects you to have your fund overnight.  But you’ll want to build it up as quickly as you can.  Having this much money in savings will protect you from life’s little emergencies.

Finally, you should review your retirement account.  If you don’t have a retirement-plan then you should investigate getting one.  Many companies offer retirement plans and most will contribute those plans.  You’ll need to check out where your contributions are going.  If you had most of your contributions in the higher risk categories then you lost quite a bit of money recently.  Choosing a less risky option will take you longer to build a solid retirement account but odds are you won’t lose money as rapidly.

This will help you get on the right track financially.  Review your credit history report and dispute any inaccurate information.  Good credit is so vital in today’s economy so you should monitor your report at least once a year.  If you need additional help then look to hire a legitimate credit repair company.  Good credit repair companies will dispute as you instruct them to.  Good financial management begins with knowing where your money goes and maintaining good credit. 

If your parents taught you some basic money management skills then chances are you are properly handling your finances.  Simple things like budgeting, paying your debts on time and saving some money for a “rainy day” are basic money management skills.  Teaching your children at a young age is much easier than trying to teach them as teenagers.  Young children are easier than teenagers when it comes to money.

Begin by giving your children an allowance.  As they grow older teach them that their allowance is similar to having a job and getting paid by their employer.  Once your children are receiving an allowance, you can begin to teach them how to save money. Learning to save money to purchase the things that they want is a great habit to get into.  For example, if your child wants a video game, teach them save their money to buy the game.  You can even use this same example to teach your children about credit.  Offer to pay for the video game and allow your child to make payments from their allowance.  You can even set up a fee to make the loan similar to an interest payment.

You can even teach your children how the real world works.  Show what it’s like to have to pay daily living expenses.  You can even charge rent, utilities and other expenses so that your children can learn good financial habits.  By teaching your children how to save money and control their debt you are giving them a solid footing for their future.  Additionally, should teach your children as they approach the age of going out on their own about their credit report.  Show them how to get it, how to read it and finally, how to dispute any information that is inaccurate.  My daughter found errors on her credit report before she turned 18.  We disputed the information and got it corrected before she started out.

Good credit is hard to come by so teaching your children is very important.  Take the time to make sure they understand how important this is to their future.