The Envelope System

One idea from dave ramsey is to develop a new budget each month. First figuring out your income for the month and then giving each dollar a purpose. One way to do this, is to figure out how much to allocate to each area and put that amount of cash in an envelope for each area (groceries/dining out, clothing, blow money). This way if you run out of money in an envelope before the month is done, you either can spend anymore from that category or you have to take it from another envelope. But then the budgeted amount from that category gets reduced.

I have mentioned before that tracking your expenses allows you to see what you are spending your money on and where you may be able to cut expenses.