new to being responsible

[busaro]

I'm recently divorced and finally had to grow up and be responsible. I have 2 children 15 and 12 and I would like to teach them how to be financially responsible. I need some kind help in accountability, I make a decent income, but I splurge on stuff I don't need. I have recently started to fix my credit and for the first time in my adult life have gotten a couple of credit cards to help establish my ability to pay. I want to buy a new home for myself and my children. My previous home was paid for but I gave it to my ex-wife. Anyhow I'm rambling I would like to see if anyone would be gracious enough to help me with some kind of information on setting up a budget I just randomly pay my bills and I need to get insight on budget building and future ira or stock option saving, so that I can save some money for my children to go to college. Please any help would be greatly appreciated thank you in advance.

[Petunia 100]

I'm recently divorced and finally had to grow up and be responsible. I have 2 children 15 and 12 and I would like to teach them how to be financially responsible. I need some kind help in accountability, I make a decent income, but I splurge on stuff I don't need. I have recently started to fix my credit and for the first time in my adult life have gotten a couple of credit cards to help establish my ability to pay. I want to buy a new home for myself and my children. My previous home was paid for but I gave it to my ex-wife. Anyhow I'm rambling I would like to see if anyone would be gracious enough to help me with some kind of information on setting up a budget I just randomly pay my bills and I need to get insight on budget building and future ira or stock option saving, so that I can save some money for my children to go to college. Please any help would be greatly appreciated thank you in advance.

Welcome to Saving Advice. If you want to work on a budget, I recommend you give either Mint.com or Manilla.com a try. If you have some goals you want to achieve, I recommend you write them down. Make them quantifiable (example, I need 10k in 3 years). Calculate how much you need to save each month to reach each goal. Then do it. I find separate, dedicated savings accounts work best for me. Best of luck to you.

[disneysteve]

Welcome to the site.

I always suggest that people start by recording all of their spending for a month. Write down every penny you spend on absolutely everything. Then, sit down and review that list. Break it into two columns - wants and needs. Compare that list total to your income for the same period. Don't forget to include savings on that list also. How much went into your company retirement plan or your IRA? How much went into your emergency fund? Finally, add in the monthly portion of expenses that don't get paid on a regular basis like insurance premiums, auto registration, taxes, etc. That will give you a pretty good idea of where your money is going.

Then you have to compare what you would like to do to what you are actually doing. Obviously, the "wants" part of the list is where you start cutting to make the numbers work.

I'm concerned about you getting a couple of credit cards at a time when you don't have any kind of budget or spending plan in place. I would lock those away somewhere and stop using them at least for now. Stick to cash for the moment. Don't be so worried about your credit score at this point.

The one thing we always suggest here is that you post your numbers for folks to review and comment on. List your income and your monthly expenses with as much detail as you can provide.

[jpg7n16]

For creating a budget, the easiest thing to do is use software and literally track everything. Some versions are free (like Mint.com as posted above). I personally use YouNeedABudget.com which was not free, but worth it.

As far as teaching your kids, they're old enough to grasp the concepts, and you seem to be teaching yourself at the moment. Why not make it a group effort to learn? Tell them you're learning to be financially responsible and will learn about budgeting, investing, insurance, etc.

If you're in need of a complete financial overhaul, I'd even recommend Financial Peace University - daveramsey.com. There are classes held primarily at local churches, but these groups can help you be accountable for your spending.

[YLTL_Dan]

Glad you're taking the step to take control of your money. I created the OWN IT plan when I finally fought my way out of debt. Check out the "Nurture your money tree" section - it includes the details for the steps below along with some helpful money tools (budget example, spending tracker, net worth tracker, etc). Hope this helps and let me know if you have any questions!

Follow these steps to Nurture your Money Tree.

1. Complete a current assessment
2. Track your spending
3. Create a spending plan
4. Monitor plan and adjust as necessary
5. Save some money
6. Attack your debt
7. What's next?