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No-Fuss Budgets

Openshaw, who is chief executive of Family Financial Network and a frequent guest commentator on CNN, says she is on a mission to show people how to budget to financial success.

"A budget doesn't have to be complicated," Openshaw told me in an interview. "You don't even have to follow a budget day in and day out. You budget so you can be conscious of your spending."

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Here's how you begin to budget, Openshaw writes:

Step 1: Determine where you stand financially. Figure out your net income and net worth and how much money you really have available to spend.

Step 2: Estimate what you're spending. Openshaw says it's important to see how you think you've been spending your money. "One of the biggest budgeting mistakes people make is underestimating their expenses," she writes. "Thanks to credit cards that allow people to spend money they may not have, most people actually spend more than they think they do."

Step 3: Find out where your money is really going and how much you're spending and saving.

Step 4: Make reasonable cuts in your spending to make sure you aren't spending more than you make.

Throughout the workbook and on the CD there are tips to help you balance your budget, including suggestions on such matters as how to reduce your long-distance telephone bill or cut your entertainment costs.

The workbook and CD have a feature I particularly love. There is a table where you can compare your actual spending on various budget items with the national average. For example, Openshaw reports (using information from the Bureau of Labor Statistics) that on average people spend nearly 17 percent of their annual income on food and nearly 6 percent on clothing. Your household spending needs may be different, but at least you can see how you compare with others, Openshaw says.

I like Openshaw's budgeting philosophy: "Budgets aren't meant to be boring, but they do help you fulfill your dreams and goals."

Budgeting is really just planning, she says. "It's deciding in advance how you want to spend the money you take in each month -- rather than making spending decisions on the fly."

Openshaw said she is so committed to making sure people budget that she is giving away 1 million free copies of the budget CD for a limited time (you have to order by Feb. 15). The CD is available at www.freebudgetkit.com(however, you will have to pay a $4.95 shipping and handling fee).

Overall, this is by far one of the easiest budget programs I've seen. If you're not computer savvy or you don't have a computer, then use the workbook.

The full kit, with workbook, is available at Amazon.com and on Openshaw's Web site at www.familyfn.com.

To become a member of the Color of Money Book Club, all you have to do is read the recommended book and come chat online with the author.

If you are interested in this month's book selection, join me online at www.washingtonpost.com at 1 p.m. Jan. 19. Openshaw will be my guest.

Join Michelle Singletary tomorrow on "Insight" with Stephanie Gaines-Bryant on WHUR, 96.3 FM. Readers can write to her at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071 or send e-mail to singletarym@washpost.com. Comments and questions are welcome, but because of the volume of mail, personal responses may not be possible. Please also note that comments or questions may be used in a future column, with the writer's name, unless a specific request to do otherwise is indicated.

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