"Obviously, this is theory and easier said than done," Dvorkin says. "Tracking every nickel is a big process and a lot of people don't do it. You can make the best budget, but if you don't track it, what good does it do? In my house, every month, we compare the actual to the budget. It's not fun. My wife hates me for it. But you have to track what you're spending."
Writing down where the money actually
goes can be a major eye-opener for many families.
lot of people say after they do the tracking, they didn't realize the little piddly
things really add up over the course of a month," says Barbara O'Neill, a certified
financial planner and family and interim extension specialist in financial resource
management at the Rutgers Cooperative Extension Program.
even had people tell me it was the impetus to quit doing something, like smoking
or playing the lottery. When they saw it was such a large amount, they realized
that could be the extra $100 a month they were looking for. They had never thought
of it as $100 a month, it was just a couple of bucks a day."
Rules 1, 2 and
Knuckey says she asks people to follow three rules
-- live within their means, take care of their future and "maximize their pleasure,"
which could mean different things to different people.
"It might be sending your kids to college, buying a certain sports car or taking
a vacation," she says. "It doesn't have to be frivolous; it just has to be in
line with your values."
different expenses today than in the past. Twenty years ago, most households had
one phone and long-distance phone calls were for special occasions. Today, it's
not uncommon for families to have two or more phone lines, plus cellular phones
and pagers. They might have a cable modem or DSL, plus the cost of their Internet
service. What used to be a $30 to $50 monthly expense can easily run more than
Computers, with software and peripherals
such as printers, modems and scanners, are aline items
that didn't even exist on our parents' household budget
sheets. The easy availability of credit and online shopping
have made it easier than ever to spend beyond our means.
with high-tech expenses have come some Internet-based resources. Quicken,
the money management software, offers a MyFinances section on its Web site to
track all your financial information. Most cooperative extension programs offer
family financial planning information; the Rutgers University program has a set
of tools at its Web site to help families plan out their goals.
Curry is a freelance writer based in Georgia.