I have recently decided that creating a budget would be a great idea and a good habit to get into. I know this in and of itself is no great secret to saving money but I found a really effective way for me to do it.
It's called Mint.com
I love technology and innovative products so this web application really caught my eye. This is probably the only way someone could get me to really do budgeting. I recently began using it and so far I really love it. It is free and very impressive. I'll try to quickly highlight its awesomeness.
For this to be effective you have to allow access to your bank account. I can already hear the older generation gasping (especially you Mom). I understand that this is a scary concept for some people but just to make sure you realize this is a trusted website with a variety of security authentifications and its connections are SSL (meaning secure and encrypted). For this application to be truly worth it you have to sync it to your bank account (I would recommend you sync it with your credit card too as most of us use that often to make purchases). It uses this information to show you where you are spending your money. Although not applicable to me you can add a savings account, loans, or investments (I know I've got to get on top of these things). I've seen these features and the use is also pretty cool, even though the graph i saw was of my boss' investments in the stock market and was obviously in a treacherous decline.
You can set a predetermined amount of money to be used in any category of your spending, there are default categories determined by the application (e.g. Grocery, Shopping, Gas/Fuel, etc.). At your login screen it shows you how much money has been spent in each category and how much can still be spent within your budget.
(Look how good I'm doing in March! Only $5 bucks spent.)
3. Auto Labels
One of the coolest features is the auto labels that Mint applies. The application is very intuitive, for example it automatically recognized all the charges on my credit card from merchants like EXXON and MOBILE and labeled them as "Gas/Fuel" purchases. It even recognized from the item description when my school books I purchased from Amazon as a books, I just had to change it to the "Education: Books/Supplies category". Most of these labels are dead on but for a couple you'll have to change them. There are tons of default labels to choose from and so far the only one I've had to create was "Tithe/Fast Offering" which apparently has been used by other users so much that it was a suggested add on anyway.
4. Positive/Negative Graphs
This is self explanatory with the picture. What probably needs explanation is the ridiculous amount of money I spent in December (no it wasn't all Christmas stuff) and the huge negative amount of money I have right now, don't worry Mom, I'm getting my paycheck tomorrow. It will all be sorted. Just goes to show that even a quick glance at this graph can help you with your budgeting.
5. Pie Charts
I think this part is one of the coolest features. With the click of a button you can see a pie chart of your spending over the last month, the current month or all-time. It is really interesting and if you click on a single section it will bring it up for you to look at all of your purchases in that category. It's a quick way to see where you are probably spending too much money and figure out why. (See picture below, I edited out how much I've spent)
This is kind of the icing on the proverbial cake. The website will send you alerts based on what you want it to. You want to know when you only have $200 bucks left in your checking account? Want to know when you have a couple hundred to go before you've maxed out your credit card (I hope you don't need this program for that)? Want to be reminded a few days before your credit card bill is due? Want to know if your interest rate changes? Want to know if any unusual purchases are made? Want to know if you've gone over budget on any of your budgeted items? You can set up alerts telling you any of this info.
In summary Mint is awesome. It may not be for everyone, but I hate budgeting and yet Mint somehow got me excited about it and has made me seen ways in which I can "cut the fat".
P.S. You must be wondering how such an awesome WebApp is free, the answer is advertising. It suggests ways you can save money by offering different credit cards, or showing you savings accounts, or investment sites. No big deal to just ignore, may actually help if you're looking at new ways to invest.