5 must-have habits to live within your means

Do you constantly feel like there is more month than money? Developing these five habits will keep your finances on track.

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  • Spending less than you make is the foundation of personal financial success. In a world that encourages us to get rich quick and take shortcuts to financial stability, it's often hard to sort out the good advice from the bad. However, simple math never lies. You cannot get ahead in life if you are spending more than what you bring in.

  • If you constantly feel like there is more month than money, work on developing these five habits and make your money start working for you.

  • Use a budget

  • A 2013 Gallup survey found that only 32 percent of all American households use a budget. The same poll also found that households making over $75,000 a year were most likely to budget. In other words, wealthy families get wealthy and maintain their status by budgeting their resources. You can find simple budgeting forms from Dave Ramsey or Provident Living. You can also use websites such as www.mint.com and www.youneedabudget.com to easily set up a household budget.

  • Keep track of expenses

  • Make yourself accountable to your budget and you'll quickly find out where your family is overspending. When you start tracking where and how you spend your money, you may be surprised at how much lunches out, quick trips to the store and movie night are really costing you. Keeping track of spending will also let you know where you can cut back.

  • Distinguish wants from needs

  • Every day advertisers try to tell us what we need to be happy. In 2011 alone, Ad Age estimates that companies spent over $50 billion US dollars on television advertising. Companies use marketing teams, social psychologists and millions and millions of dollars to trick us into buying things we don't need. Be aware of how advertising influences your purchasing and ask yourself before every purchase, "Do I really need this?"

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  • Avoid comparisons

  • Mark Twain once said, "Comparison is the death of joy." Trying to keep up with others will rob us of happiness and leave us in debt. When we're chasing someone else's lifestyle, we're forgoing the opportunity to create a life filled with the things that truly make us happy.

  • Develop an attitude of gratitude

  • Much overspending could be avoided if we appreciated what we already have. Oftentimes, we buy things because we are feeling bored, lonely, isolated or upset. The next time you want to indulge in some retail therapy, make a list of ten things you're grateful for first. Switching your focus from what you don't have to what you do puts finances in their proper perspective. Accumulating stuff cannot bring long-term happiness, but feeling like a slave to your money will certainly bring long-term misery.

  • Financial advisor Dave Ramsey is famous for saying that finance is 20 percent head knowledge and 80 percent behavior. While it's helpful to have a sound understanding of budgeting and financial planning, the most important ingredient for successfully living within your means is having a good attitude about money.

  • By being accountable for where your money goes and avoiding the pitfalls of social comparison, you'll be well on your way to financial stability.

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Heather Hale is a fourth-generation Montanan and mom to three crazy boys.

Website: http://moderatelycrunchy.blogspot.com

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