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Ask Dave

How To Budget

Laura gets advice from Dave on how to make her money behave by writing out a budget.

QUESTION: Laura is a stay-at-home-mom and her husband makes $50,000 a year at a church. They have two kids and own 30 acres, though they live in a mobile home. They have $20,000 in credit card debt and pay $250 a month on a car payment.

ANSWER: You aren’t writing it down. Every month, before the month begins, you and your husband need to sit down and spend every dollar on paper, on purpose. Every dollar must have a name. Most people who do that feel like they got a raise. Then you stick to that budget; if you don’t have the money in a category, you don’t spend the money. You have to make your money behave, otherwise it gets away from you.