It's true that money plays a large role in America, and how we manage ours makes a difference in our lifestyle. Creating a budget is absolutely necessary when trying to successfully manage your money, regardless of income. Budgets help us plan out where our money is going to be spent, and it also helps us avoid spending money on unnecessary items. By writing your budget down you are holding yourself accountable for balancing income and expenses. Budgeting is a fabulous way to organize your finances and lower total monthly spending.

Just by writing down a budget you will be better prepared to understand where your money is going. Sometimes it is shocking how much money gets spent on useless items like Starbucks or eating out at lunch. Writing your budget down will help you see where money is being spent and establishes a guideline to look back on at the end of the month. A budget gives you reason to take action and propels you toward a life of financial freedom.

Coming up with your first budget is fairly straightforward. Gather those involved in either income or spending of the budget and first list items that are monthly necessities. List things like: rent or mortgage, groceries, utilities, gas, and car payment. Payments on credit card debt should also be considered a monthly payment and included in your budget. The next step is to tally up the various sources of income for your family. Now you can compare income versus expenses and see how you are doing. Is there a great need for more income? Are there some things on your list that could be reduced or eliminated completely?

Take a good look at the items you purchase each month and classify each as necessary or unnecessary. Now, take a look at the items with the unnecessary label and decide where each fits into the budget, and which items don't belong at all. Ask yourself what you need instead of what you want when sifting through these items. Things like food and shelter are clearly necessities, but what about that impulse bought shirt or that expensive sushi lunch you just had to have? Try to keep items in the entertainment, travel, dining, and impulse purchases category to a minimum in order to meet your budget.

Americans are all about convenience and retailers are setting us up to pay more money for a little more convenience. Fast food restaurants, quick marts, and cell phones are prime examples of conveniences. Credit cards are another convenience that could very well be hurting your budget. You can buy just about anything with a credit card and it seems so easy, until you get the bill. The biggest problem with a credit card is that it is quick and you don't realize how quickly you are spending until it is too late. The majority of credit cards have an APR of around 18%. This means that, unless you are consistently on time with your payments, you are paying an extra 18% for all of the goods you purchase with a credit card. Sure cards can be convenient, but they can also be expensive!

The benefits of a reasonable well thought out budget far outweigh the negatives. The budget will show you where your money is going, how you can stretch those dollars further, why you are coming up short every month on your bills, and what you can reduce or eliminate from your life. Put together a budget tonight and find out how much you spend on lunch, entertainment, or convenience in a month. It may surprise you.

Joe Larson is one of the certified Christian credit counselors for Family Life Credit Services, a nationwide Christian credit counseling agency since 1986. The goal of FLCS is to strengthen and encourage families and individuals through Christian faith-based financial counseling. They offer financial educational materials free of charge as well as the opportunity to work with a certified counselor in your area of need.