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Does the thought of making a budget give you anxiety? Don’t stress.

With a realistic budget, you can put yourself in a stronger financial situation. While it may hurt at first and require a change in your lifestyle, the long-term rewards are well worth it. For example, through the simple act of creating a budget, you can take proactive steps toward paying for your child’s college education, saving for retirement, getting out of debt, saving for a down payment on a home, or any other financial goal you’ve made for yourself. So take a deep breath, and let’s focus on the light at the end of the budget tunnel.

Face Your Demons

The first step to creating a budget is to face your demons and look at your spending. (Check out our post on How to Find Out Where Your Money Goes for tips on how to track your spending habits.) Don’t forget to take semi-annual expenses into account like property taxes, registration, holiday gifts, etc. Tools like Mint.com make it easy to break up your budget into categories, as well as analyze all of your transactions.

Break Down Your Budget

After you look at the trends of your spending, you can easily predict how much you need to spend in each category and where you could cut down. If you’re saving for a specific goal, you should include that as a fixed monthly expense. Why not pay yourself first?

Wondering what your budget allocations should look like? Click here to check out our video!

Keep an Eye on Your Goals

As you analyze your budget, ask yourself if your money is going to things that are less important than your goals. Is eating lunch out each day worth cutting your vacation fund short? Every dollar counts when it comes to reaching your goals.

Pay Bills and Chill

One of the easiest ways to keep your budget on track is to make your payments automatic. Use your Chartway Bill Pay to schedule bill payments and a recurring transfer to your savings account. This will help make paying bills worry-free. #PayBillsAndChill