Most of us will find it very beneficial to take the necessary steps to learn how to create an estimate of expenses on a monthly basis along with monthly cash requirements.

Those of you who feel uncomfortable using spreadsheet software packages such as open office, google spreadsheets you should atleast pen some numbers on a legal-sized pad.

You could start by dividing the page in two separate columns. In the first, write down the income sources. In the other, write down the different monthly expenses. This should mention monthly expenditures such as groceries, gas, other utilities. Whatever you come up with add another ten percent for those last minute unexpected expenses.

This where you have to go the extra mile. You should plan for different scenarios that can come up. Create another budget (this is fictitious) that lists all the costs every month , income sources and their difference. But... do not add any credit card interest payments. Also remove any car loan interest. Thats not all, if there are any expenses that could be more of 'impulse' purchases then add these to the running total.

This new total represents the amount you could possibly prevent paying monthly. This total could be around 15% of your monthly expenses. For some of you its going to be higher. The key point to realize is that these charges can easily be prevented with some planning.

So, this brings us to an important point. Do you really need that new car right now? How about that fancy watch? In this age of instant gratification we tend to want everything right now. But, are these items - new car, watch etc. truly needed at this point of time? Could you save for these instead of buying them upfront and paying interest charges on the credit card or that new loan that you took.

You have to make a decision about whats important to you. This habit of developing a budget will help you hold up a mirror to your fiscal habits. If you don't like what you see, thats alright. Realizing that there is a problem is the first part of seeking the cure. So, lets get started ...