Budgeting your monthly expenses in order to get the greatest return on your income, and perhaps even put aside some for saving doesn’t have to be extremely difficult.

Various budgeting programs are available for use. Money management programs provide you with the usual package that allows you to enter your cash inflows and outflows, categorizes your expenditures, and at times, presents to you an analysis of your spending behavior. Through these programs you can also input the various payments you have to make monthly, and subsequently track if you’ve paid your bills on time. One of the absolute best free money management/budgeting tools available is is Yodlee.

I have been using it for over 15 months and it has made all the difference in our lives, as far as keeping track of all our accounts in one place. I have also tried Mint and found it not to be quite as robust as Yodlee.

Another budgeting tool that you can utilize are coupons. Various stores and magazines contain coupons that you can use to get discounts on various products. Should there be a need to purchase a particular product for which you have a coupon for, you will end up saving a fraction of what you might have had to spend on a regular purchase.

Lists, whether on a piece of paper, on your cell phone, on your personal digital assistant (PDA) or on a website (I’ve used this one plenty of times Don’t Forget the Milk will help you keep focused on what you have to buy, and in effect, keep track of the purchases you make. A classic example is your regular grocery trip. Prior to making the trip, plan out the week’s entire menu and identify what food items and materials you need to purchase that are unavailable in your pantry. Then, make a list of other household items that you’ve run out of (or are eventually going to run out of before you can make the next trip to the grocery). Armed with these lists, you can go to the grocery and know exactly where to go and what you’re going to buy. Without these lists, you will walk idly along aisles, and will likely pick up various food items that you won’t need in the immediate future, or already have at home.

A filing system is perhaps one of the best budgeting tools you can have in your home. With simple, labeled file folders, you can put together your bills, your receipts, and whatever bank documents are issued to you when you save or pay. By putting together your bills, your credit card receipts, and the like, you are able to keep track of how much you owe and when your payments are due.

Effective budgeting tools are those that best address your needs as a consumer. Create your own budgeting tool or find a program to do it for you—just make sure it suits your lifestyle.

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Living cheaply is all about prioritizing and being cagey. Living cheaply is kind of like being on a diet. If you try to restrict yourself to raw vegetables and wheat thins, sooner or later you will break down and eat the contents of your fridge, and yes that includes the condiments. Living cheaply is not the same as living frugally.

Frugality is a lifestyle choice. It is in the eye of the beholder. It is about saving the most amount of money over the long term. Frugality , as I understand it, is to make wise choices when it comes to your expenses; it is the art of efficiently using your resources; it is the art of making the best of your life by staying within the limits of what you can afford. It is spending wisely and avoiding unnecessary expenses.

Frugality is usually applied to matters of consumption, and commonly points to simplicity of style; miserliness is frugality carried to an extreme, involving meanness of spirit, and a sordid mode of living. Economy is a virtue and parsimony a vice.

Frugality is living with less of what money can buy. It is the attempt to save money when you can, rather than spending it. Frugality is a great way to save money, especially if you don’t have a great deal of money coming in. It doesn’t mean I’m cheap, it means I have priorities, and avoid impulse buying. Frugality is very freeing and fulfilling. I have gained everything worthwhile and lost nothing of true value.

Personally I think frugality is a means to an end. For me I am frugal in order to save money so I can spend it on what I really care about most. I don’t think anyone can judge another as being “not frugal”. It’s not about a contest to see who can spend the least.

Rather than aiming for absolutes and risk failing miserably, incorporate frugality in your life in small doses. The change in your mindset will help you a lot in the long run, as opposed to small prizes by taking drastic steps.

Spending money on something unnecessary is wrong, but not spending money on something necessary is equally wrong. Spend less than you make. Don’t spend more than you can afford.

Material wealth does bring some happiness, but we generally overestimate how happy it actually makes us. Material purchases are about what you have. Experiential purchases are about who you are.

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