Budgeting – how to avoid a financial bind Published July 18, 2011 By Airman 1st Class Frank John Casciotta 71st Flying Training Wing Public Affairs VANCE AIR FORCE BASE, Okla. -- When Angel Dominguez walks into his office each day, he has one thing on his mind -- money. He sits at his computer, looks through his appointments and prepares for his first client. That client is greeted with, "Let's make some money." When starting out, Airmen sometimes find themselves in some sort of financial bind simply because they are not paying attention to how much money they make verses how much they are spending, said Dominguez, a career readiness consultant at the Airman & Family Readiness Center here. A bad habit people get into is using a debit or credit card as their main way of making purchases. It is a better idea to get into the habit of using cash instead, said Dominguez. "It's much harder to get rid of that last $20 bill than just swiping a card," said Dominguez as he reached out his hand with his thumb and forefinger together, pretending to struggle with giving up an invisible $20 bill. Cash is something people physically give away in exchange for goods. When people carry cash in their wallets as their primary means of exchange, it is easier to keep track of how much they are spending, said Dominguez. On the other hand, if someone uses a credit or debit card as the primary purchase preference it is easier to spend money with little attention to how much is being spent. It is much easier for a person to swipe a card and put it back in their wallet. It is an electronic exchange not a physical one. People don't notice how much they are spending, said Dominguez. If a person is looking to make a big purchase, budgeting is a key part in the process and there are resources available here that can assist in the process. The first step in budgeting is making a cash flow chart. These charts make it is easy to keep track of spending, said Dominguez. "It's all about saving money." One of the easiest ways of making a cash flow chart is getting a template online. A free example of one can be found at www.free-financial-advice.net. Using this chart, people can take their monthly earnings and ration them out among whatever their expenses are each month, said Dominguez. The chart is split into four sections: income, necessary expenses, discretionary expenses and investment spending. An easy way to stay on track with a budget is to take out all the cash needed for the month for things that can be paid for in person. Afterward, make envelopes labeled for each expense, and then divide the money accordingly, said Dominguez. "I like to use envelopes because it's really easy to keep track of how I spend my money," said Dominguez. Another part of budgeting is being a smart shopper. A person can improve their spending efficiency by paying attention to what they buy and where they buy it, said Dominguez. "You will want to stick to the outside walls of grocery stores because that's where all the essential food items are found. As you start looking in the center aisles, you start to find non-food items and things like junk food," said Dominguez. "You are much better off buying non-food items at discount stores because they sell things like that in bulk," he added.