Budgeting is a word most of us are familiar with. Though every one knows what a budget is,very few are actually able to make and stick to a monthy budget. The truth is that most of us start out with the best of intentions, but more often than not, an unexpected expense comes up and busts our budget. We then give up and go back to juggling our finances and worrying about having too much month left with less than enough to money to carry you through. However, if you are striving to create a budget for the purpose of systematically paying off your debts or to start a savings and investment program, then it's critical to develop a workable and realistic budget.

So can the problem be? Why do most of us fail at the simple task of creating a budget so we can live within our means? The simple truth is that most budgets don't work because they fail to account for irregular or variable expenses. Everyone knows how much their rent or mortgage payment is. It's the same amount month after month. If your rent is $1,000 per month, that's a no-brainer. The same is true of many other fixed expenses, such as auto loan payments, cable TV subscriptions, insurance premiums, and so on. It's easy to budget for these expenses because the amounts don't change from one month to the next.

Besides expenses that are the exact same figure each month, there are numerous types of expenses that vary a little from one month to the next, yet we still have a pretty good idea of how much we spend each month. A good example is our grocery bill. Most of us know how much it cost us every week to buy grocery from the super market.  So, we can insert a realistic figure into our budget-in-progress and not be too far off the mark. The amounts may go up or down slightly each month, but we usually know the range we're dealing with.

The real reason, most times for busted budgets are the variable or irregular expenses. How much will you spend on medical bills? What of car repairs and hhome maintenance costs? It seems that bills for these types of expenses hit us out of left field, and there goes our budget. Before long, we're using food money to pay for a new set of tires for our car and the whole planned budget comes crashing down.

So what's the solution? There is no faultless answer to this problem. But we can come to a close estimate by using the simple technique of monthly averaging. Start by gathering 12 months' worth of checkbook registers, bank statements, and credit card statements. Write down how much you spent on anything that was a fixed expense.  Categories these expenditures  such as auto, home maintenance, clothes, etc. Then keep listing each of these expenses under their relevant categories for the full 12-month period.

After this is done, you ought to have a first rate idea of your total annual expenses for these variable. That's how much you need to allow in your monthly budget in order to build up enough reserves to handle the need for new clothes when it comes up. Again, this method isn't perfect, because an expense may come up that exceeds your estimated outlay, but at least it takes into account a closer approximation to reality than simply guessing.

The ploy here is to set up a separate savings account where extra funds will be kept for these expenses.  If we think we have our bills covered, and there is still some cash left, the tendency is to want to spend it on something fun. But if we know that there really is no cash left over, because we haven't yet set aside the extra $100 needed to keep our car on the road   then we'll be less disposed to spend it on pizza, icecream and movies.

Budgeting can be successfully accomplished by this technique of monthly averaging, especially if we are consistentt year after year. As the year pass by, our understanding of our true expenses becomes clearer and clearer, and we are no longer surprised by the sporadic unexpected expense.

The best way to put into operation this approach is to set up a habitual  savings program, where the amount you're setting aside to cover irregular expenses gets automatically deducted from your paycheck and forwarded  to your savings account,in that way you don’t get to see the money and the temptation to spend it never comes.