A budget a day makes the creditors go away

Frugal Dad has an idea for tracking his spending so closely that he can keep a running tally in his head. Instead of relying on a monthly budget to balance his bank account, he calculates how much pocket money he gets to spend everyday. That way he knows if he buys a latte and pastry in the morning, he had better brown bag it for lunch.

"I break down my incidental, or miscellaneous, expenses budget for the entire month down into a daily amount," he says. "For instance, if I set aside $360 in June for incidental spending (eating out, clothes, gifts, entertainment, etc.) then my daily incidentals budget is $12."

He uses the $12 daily allotment for food, music, magazines, trips to Target, and all the other extras that he buys. It may not seem like a lot, but if you skimp a few days you will have a good chunk of change. It may also help you say no to spending on items you don't really need.

Figure out how much you can allot for incidentals each month by filling out this budget worksheet.