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How to Develop a Budget on a Debt Management Plan

By: Abby Reid

It isn’t easy to carry out a debt management plan or live on a reasonable budget in today’s consumer market. Effective advertising and marketing executives work hard to convince the average American citizen that happiness lies in material possessions that only money can buy fast luxury cars, large homes or cutting-edge electronics. Unfortunately, this is why many people are bogged down with debt and bankruptcy. Developing a budget during harsh economic times can seem extremely difficult, but it is imperative if you ever hope to survive on a debt management plan. Budgets help you overcome poor spending habits and avoid bankruptcy. Like any other valuable skill, learning to live on a budget can take time, patience and practice. The following information will help you develop your own budget-friendly debt management plan.


  • Make a list of all of your necessary expenses or bills. This includes bills that you must pay on a regular basis your rent, phone, car insurance, health insurance, mortgage payments, student loans, utilities, cable and internet, etc. Add the costs of your payments together to find the total amount of your typical mandatory expenditures.

  • Credit counseling service companies, like Advantage CCCS, suggest keeping track of your expenses for a week. Grab a notebook and write down everything you buy for at least seven days. Don’t censor yourself. Record every penny that you spend - from a gallon of gas to a cola or bag of chips from the vending machine in your office’s cafeteria. Add up the total amount of cash spent at the end of each day.

  • Consider your income. Are you spending more money than you make? Do your monthly expenses amount to more than your monthly income? Do you find that are you barely getting by financially each month?

  • Highlight any items you purchased that were unnecessary. Unnecessary spending can ruin your budget goals. If you find that you are regularly spending more money than you are making, you must reconsider your buying habits. Use a highlighting marker and highlight any items that you purchased that were not necessary. You will probably be surprised by how much you spend on extraneous items like coffee, movie rentals or restaurant meals.

  • Eliminate any unneeded expenses. Get rid of any magazine subscriptions, premium television channels, clothing expenses or additional phone features that you do not need. Look for other regular expenditures that are not necessary and can be eliminated. It may not be easy at first, but after a few weeks, you may find that you never really needed 200 cable television channels.

  • Look for substitutes. Search for cheap or free ways to participate in activities that you enjoy. If you love reading, borrow books from your local library. Prepare meals at home instead of dining out at a fancy gourmet restaurant. Visit your local park’s hiking trails instead of paying for a gym membership. Instead of purchasing a $3 latte each morning, learn to make your own. Visit your local beauty school’s training center instead of spending exorbitant amounts of money at a salon.


Staying on a debt management plan isn’t always easy, but it will undoubtedly pay off in the long run.

Article Source: http://www.articlesnatch.com

About the Author:

Advantage CCS is a free consumer counseling service that offers free debt management programs and bankruptcy counseling.

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