I almost feel silly writing this because I know you’ll laugh.  This is so simple, I’m sure you already know it.  But, like millions of others, you’ve made budgeting and spending so complex, you’ve forgotten the elementary principles behind money management.

You’re not the only one.  People do it all the time.  That’s why there are so many financial magazines, websites, and blogs out there.  People need financial guidance.  They add unnecessary complexity to simple things, then wonder why the thing that used to be so simple has become so difficult.

And here it is, the one thing that will always keep you from being broke – Never spend more money than you make.  If you make $100 a month, only spend $90.  If you make $10,000 a month, only spend $8,000.

Before you try to correct me, yes, it is possible to spend more money than you make.  You can dip into your savings, use credit cards, take out payday loans, or borrow from friends and family.  When you live like this, you’ll end up drowning in debt in no time.

This is the point where most people begin to argue and say, “I can’t help but spend all my money, I have bills to pay.”  The latter part of that statement is quite possibly true.  The first part, however, is almost always false.  You feel like you have to spend all your money, but you don’t.

There is a very easy way to make decisions about what to spend your money on.  Ask yourself what will happen if you don’t spend that money.  If the answer doesn’t lead to death of you or a loved one, don’t spend it.

Next, don’t try to disguise luxuries and necessities.  Food, you must buy.  Steak and shrimp, you can live without.  Clothes, you must buy.  Designer jeans, you can live without.  Electricity, you must buy.  A thermostat set to 60 degrees in the summer, you can live without.  Do you see how easy it is to spend all your money on frills?

Put your income and expenses on paper where you can see them.  Use cash to pay bills and buy groceries if you have to.  Whatever it takes to get your spending under control and make sure you never go broke again.