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Budget can get finances back on track

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Dear Dr. Don,
How can I set up a budget that really works? I need to learn how to conquer depression, fears about outliving my money, not being able to help my children enough, fighting off panic attacks, trying to prevent others’ demands from derailing my efforts, etc., etc., etc. Help!
— Marie Morass

Dear Marie,
While I have no doubt a feeling of financial security can help improve your outlook, it’s not a panacea for all of life’s worries or troubles. You may need to work with a medical professional to manage your depression and anxiety. Meanwhile, working with a fee-based financial planner may help manage your financial anxiety.

I can help suggest a do-it-yourself approach to managing finances. However, I don’t like to call it a budget, but prefer to call it a spending plan. That term puts a more positive spin on things. It’s your income, and you’re deciding how to allocate it to current spending and investing to reach future life goals.

Bankrate offers budgeting — or “spending plan” — help through its home budget calculator and its Financial Literacy budgeting package.

Distinguish between what has to be funded to keep the household afloat and discretionary expenses. There’s a difference between needs and wants. If you’re trying to allocate part of current income to future spending, you need to lighten up on today’s discretionary spending. Automatic investment plans can make saving a priority in your spending plan.

If it’s a choice between funding your children’s college education and funding your retirement, choose to save for retirement. The children can get college financial aid easier than you’ll be able to find someone to fund your retirement.

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Read more Dr. Don columns for additional personal finance advice. To ask a question of Dr. Don, go to the “Ask the Experts” page, and select one of these topics: “Financing a home,” “Saving & Investing” or “Money.”