Since 2012 is around the corner, a lot of people’s new year’s resolution will be to be debt free. That can mean many things from, paying off your current debt, creating a budget, and also having an emergency fund. Creating a budget can be a daunting task, but in reality it is a simple and proven way to keep yourself from over spending, and out of debt. It can actually be very simple to create a budget. Make a list of your most common set expenses that don’t usually change, like your rent or car payments.  Those are fixed expenses that you can’t really cut back on. Try to calculate how much money per month you will dedicate to paying off your current debt. Once all the debt is paid, keep using that money to save it as an emergency fund.

Another easy thing to do  would be to create a list of expenses that is a little more flexible. For example like how much you can spend on entertainment, eating out, or clothes.  Make sure that you keep track somehow of how much money you spend. This could be in a digital way like an excel spreadsheet or just a place where you keep all of your receipts can work as well. At the end of the month add it all up, and if you notice you over spent in a certain category, cut back on another to compensate for it. Always have a budget and a way to measure it, it is a great way to stay out of debt. Another great idea would be to have someone like a friend or spouse keep you accountable and make you stick to your budget. With these simple tips, you can make 2012 be a step closer to a good financial future.