Most people could tell you how much money they make in a year. Fewer could state how much money they spend, and fewer still could explain how and where they spend it. One of the best ways to figure out your what comes in and what goes out—is to create a budget, or a personal spending plan.

A budget forces you to put down on paper all of your income and expenses, and this can be an indispensable tool for helping you meet financial obligations now and in the future. As an added bonus, a budget can be a real eye-opener when it comes to spending choices. Many people are surprised to find out just how much money they are spending on superfluous goods and services.