Let’s face it. Budgeting just isn’t easy for some people. They try to budget unsuccessfully time and time again.

We’ve written all kinds of things about building budgets, from how to do it with a pencil and paper to how to use technology to make it easier. We’ve written about how to optimize your budget and how to get back on the horse if you fail at budgeting.

I figured it was high time we delivered an article about how to boil budgeting down to the bare essentials. Here’s how to budget as simply as possible:

The Wants vs. Needs Budget

This is a budgeting technique my father taught me when I was about 7 years old, and it really is the simplest way to make budgeting work for you. Budgeting is more a way of life than a set of hard and fast rules, anyway. Some people find comfort in the structural stuff, but if you don’t, try this method.

The Lists

To build a super basic monthly budget, make two lists.

On one, write down all the things you must pay for during the month, including the dollar value of each of them. This list should include things like bills, food, debt payments and other bare necessities.

On the other list, write down all the things you want in your monthly budget that aren’t imperative, along with their prices. This list can include things as frivolous as shopping trips or as seemingly important (but unnecessary) as eating out.

Finally, go through your wants list and prioritize it by marking the most important needs and basic comforts with low numbers: 1, 2, 3, and so on.

Prioritize and Pay

After each pay period, take care of as many of the needs as possible, right away. Those you can’t pay should be scheduled in your calendar immediately after your next paycheck. Write them someplace you won’t forget them.

If you get paid twice per month, pay at least 50% of the dollar value of your needs list. If you get paid weekly, divide your total needs cost by the number of weeks in the month and pay at least that much. The key here is to prioritize and pay your needs off first after each pay period.

Finally, after the appropriate portion of your needs have been paid following each pay period, you can move on to your most important needs.

At it’s base, budgeting involves understanding what bills you must pay and what purchases you must make and taking care of them first. The key lies in understanding the difference between wants and needs in your life and making sure you aren’t paying just for needs. Even a kid can understand that blowing all your allowance on candy won’t leave you any money to save for the bike you’ll need to get yourself around all summer long. Take heed.

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Photo: mollypop