I realize this article is probably long overdue. I have written column after column about how you should check your budget for this and that but I’ve never written about building a good budget. Better late than sorry, right? Here’s my advice for building and following a great budget.

First things first, figure out what’s coming in and how it’s going out.  Write down under a header called “income” how much money you make. Be sure you include all of the money that comes in, not just from your day job. For example, if you babysit a couple of times a month include it. Now subtotal income.

Next, under a header called “expenses,” list all your expenses. This is going to take a little while because you need to think of absolutely everything. Common categories will include tithes and offering, housing, loan payments, utilities, insurance, credit card payments, food and entertainment, but you also need to include the little things like those pesky vending machine runs during your coffee break, the mad dash to the Red box and Friday late night pizza calls. Once you’re positive you’ve got it all down, subtotal the expenses then subtract expenses from income. I hope you ended up with a positive number! Even if you did, it might not be as positive as you think.

Now comes the fun part! You know how much money you bring in, you know how much money you spend, now let’s talk about the best possible way to distribute your income – it’s called the 60% Solution. This method was created by Richard Jenkins, editor-in-chief of MSN Money, and it’s used by financial advisors everywhere. According to this method, you need to keep your committed expenses at or below 60% of your gross income to be on the right financial track. Your committed expenses include basic food and clothing, essential household expenses, insurance premiums, charitable contributions, and all of your bills and taxes. The remaining 40% should be directed like this: 10% retirement savings, 10% long-term savings, 10% short-term savings for irregular expenses (emergencies, repairs, new appliances, gifts – you get the idea!), and  10% for entertainment and vacations.

At this point, my readers will be having one of two reactions: either nodding in contemplation, or alternating between hysterical laughter and tears. Sadly, a lot of people have gotten into debt right off the bat in their adult lives. Cars, student loans, credit cards, rental furniture and even luxuries we cannot afford like premium cookware can put us in an impossible budget situation before we even sit down to make our first budget.

If this is you, analyze your spending habits and decide how you can either cut back on expenses or increase income, or perhaps a combination of both. If you have a lot of debt, chances are the 30% that is supposed to be going to savings of various types is all going to pay debt. Understand you are cheating your tomorrow with your desperation of yesterday. Time to stop that madness and get the debt paid off once and for all, and start putting money in savings that will ensure you stay out of debt when those special occasions and unexpected expenses come your way – which they will, on that you can budget!

And the fun never ends!

Guess what – you need to do this every month. There’s the budget template, which is what you made to begin with, and then there’s the living, breathing, month-by-month budget that changes with the seasons (higher electricity bills in the summer) and the times (Mom’s 60^th birthday party). Tricks to keep yourself on track include writing down your expenses, reconciling your checkbook monthly and having yet another time once a month where you sit down to pay bills and make sure you’re on target with your spending and income goals for the month. Also think ahead by writing down in your planner or calendar birthdays, trips, winter clothes and other expenses as you think of them, so when the month comes around where these unusual expenses fall, you’ll be sure to include them in your budget.

Budgeting is like dieting. For me, neither is fun. I’d love to splurge both in my spending and eating habits, but that’s not sensible. I know better than that. The grown up thing to do is spend smart. So start today by getting the numbers down on paper just to see where you stand. And if it’s not pretty, do the tough analytical work to determine a solution – either by decreasing spending or increasing income. Then, live the budget. Expect set backs, and don’t get down on yourself when it happens. Persevere if you mess up.

Remember that even if this is no fun, a hefty savings account and no debt feels way better than the sleepless nights worrying about collection agencies, creditors and bankruptcy. For a gal just starting life on her own, getting off on the right foot is essential to a long, regret-free life.