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Expert Advice: Needs vs Wants

Needs vs Wants - Interview Highlights from Your Life, Your Money

Manage your money with a budget

A budget is a roadmap. If you've got more money going out than coming in, you've got to cut costs or increase income. A budget gives you control over your money so you can do the things that you really want to do. Don't look at your budget as an enemy. Embrace it as a way to get the things that you want. The most important thing is to put money aside every single time you get paid. Then you'll have some savings.

Michelle Singletary, Washington Post financial columnist

Take a closer look at your spending habits

Most people can't make budgets work because they just make a list of what they already know. What they don't know is what breaks the budget. You know how much your rent and car payment are. It's easy to find out how much the last tuition bill was. That's the problem with budgets. We write down the stuff that we already know.

Instead, you need the numbers you don't know. How much do you spend daily on cabs or coffee or visits to the soda machine? It's that $.75, $1.25 that you throw into that machine and never think about. That adds up if you do it every day. So before you make a budget, get a receipt for every single thing you buy in a week, whether it's an $800 computer or a $.50 newspaper. A daily spending diary can reveal things you may not realize.

Peter Bielagus, author of Getting Loaded: A Complete Personal Finance Guide For Students and Young Professionals

Know where your money is going

It's a great idea to keep a spending diary. List everything, from a $6 sandwich to a $3 café au lait. That doesn't mean you can't have those little extras, but you want to get a feel for where your money is going. Why does your paycheck seem to disappear from month to month? That's where a spending diary can really help.

Beth Kobliner, author of Get a Financial Life

Think about spending

Be deliberate about spending. Don't do spend without really thinking about it first. That's how we get into trouble. That's how we end up in credit card debt. Then we end up having to dig ourselves out a couple of years later on an entry-level salary. That can make it very difficult.

Ron Lieber, New York Times columnist