Having a budget definitely helped me get out of debt. I was able to figure how much I could spend each month, what I could pay towards my credit card debt, and what I could save. Without a budget you are setting yourself up for failure.
STEP # 10
A budget shows how much you spend your money on a daily, weekly, and monthly basis. It breaks down to what you can spend on any given day. So again, Do you need a budget? The answer to that question is a whole heatedly, YES! If you don't have a budget written down and having it all in your head doesn't count, you will jeopardize your chance to ever get out of debt.
The first thing you need to do to start a budget is determine how much you have to spend. The total limit you have to allocate can feel overwhelming. It's up to you to determine what you spend for groceries, pay the minimum or a little more on your credit cards, and what's left over for entertainment. Write down your monthly debt payments as well as your total expenses for utilities, etc. Then subtract that from your income. What is left over is what you have for savings and entertainment. This was the hardest point for me. It's kind of like we like chocolate, but broccoli is better for us. Paying off your debt and having fun on what's left over sucks, but it has to be done. Building your emergency fund should come before entertainment too. I am not saying you shouldn't have some fun, but having too much fun is probably how you got in debt to begin with.
If you need help in developing a budget for getting out of debt visit Quicken.com for some more tips and also check out their Simple Money Management Program.
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