When I was first married I created a budget.  It was hard work.  It was not easy to track expenses, save what we needed to, and stay out of trouble. Financial success is rarely achieved without a solid plan for spending and saving money. A budget can play an important role in clearing debt and building a safety net so that you can make the most of your hard-earned cash. But creating and sticking to a budget can be hard. What steps can you take to make it happen?

First know where you stand financially

One common mistake people make when creating a budget is to cut all the fun out of life. A “Top Ramen” budget invariably fails because it has no room for entertainment; so instead, learn to moderate. The first step is to track your expenses over a period of time (four weeks at the minimum) using an app or computer program or the old fashioned pen and paper.

Once you identify where your money is going, the next step becomes easier; deciding how best to allocate your money in the future.

Set your savings on autopilot

Though budget scenarios are unique to each person, one common practice that all financially independent people have is to save at least 10% of all income, and a direct deposit is the best way to achieve this. The idea is to put aside that money early enough so that you don’t see it; that way you won’t be tempted to use it.

The first step will be to build your cash reserve and then move on to automatically funding long-term investments.

Figure out what you really need to save

Families usually spend about 35% of their earnings for housing and utilities. Bear in mind that homeowners can increase that figure because principal payments are essentially a form of forced savings, and payments made towards mortgage interest is tax-deductible.

When saving for something specific, such as new car or your child’s college education, an additional 10% may have to be set aside, preferably into an investment program or the tax-friendly 529 college savings plan.

At this point you have to set priorities and cut back on bad spending habits. If it’s not practical or necessary, don’t assign it a significant portion of your income.

Use cash to track spending habits

Using credit cards can make it easy to track your expenses but that plastic can also make it far too easy to overspend. If you can’t manage the cards, make a plan to withdraw a specific amount of money at the beginning of the month (avoid ATMs that charge a fee) that way, you force yourself to make better financial decisions. By spending cash, you get a clear picture of where you money goes, and it helps in setting priorities.

Aside from the mortgage and car loan, most consumers should be able to set up a policy for paying only with cash when out shopping or purchasing non-essentials.

Learn to live within your means

This is a matter of spending less than you make; and for the average consumer it means cutting back on a few luxuries- but not doing without. Find ways to minimize your expenses without crimping your lifestyle too much.

As a general rule, you have to be content with your own lifestyle. The problem comes out of competition, where individuals try to match or exceed their friends’ or neighbors’ lifestyle, usually to the detriment of their own finances.

By gaining control over your spending habits, you prevent losses and set yourself up as a financially secure person and family.