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Ask anyone who has lived on a budget and they will tell you how difficult it is. Over the last few years, my wife and I have tried to budget several times and we continued to have trouble sticking with the plan. After several attempts, we finally committed to the budgeting process and have been successful ever since. The key is what I call "the envelope method."

The first step, of course, is to create the budget. Most people sit down try to remember all of their bills, and then jot them down on a list. But instead of trying to remember each of your bills, just use your last three bank statements. Some bills vary month-to-month, and if you look at the last three bank statements, you can average out what you spend on your bills.

In addition to tracking your bills, you also need to remember to track your spending money. Where is that money coming for lunch everyday? How about the trips to the movie theater? The mall? How about the golf course? It's best to write down every expense that you incur.

Once you come up with a list of all the expenditures you encounter each month, now you can cut down what is being spent and create the budget. There are a few places most people can trim the budget. Here are a few ideas:

Do you really need a cell phone and a land-line? Cell phones continue to get cheaper while many people are paying $25-$50 on a land-line. It might seem like a big step to eliminate your land-line, but it will be nice to cut out that bill every month!

Some people keep their land-line so they can use the internet. But by the time you pay for the phone service and the internet service provider, you end up paying much more than you would for high-speed internet alone.

Do you have cable television? Do you have high-speed internet? Give a few local cable/internet providers a call or visit their website and see how much you can save by bundling those two services together.

As you look over your spending, you'll be able to figure out a few other ways to cut a few bucks off most of your bills.

Once you've nailed down your budget and have a monthly target of how much you'd like to spend (and save!) each month, you have to actually stick to the budget. It's more difficult than it sounds. It requires discipline and a commitment to saving. You might decide in your budgeting that you only want to eat out for lunch once per week. But if you are undisciplined, you might decide on an extra lunch one week.

My wife and I heard of "the envelope method" in which, on the first of

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