As the new year begins, the last thing anyone wants to think about is the budget. Yet, this is a perfect time to reflect upon your spending over the past year. What worked for you and what did not? As you look into 2007, you need to plan, and the following questions should help you focus your thoughts.

Did I keep track? First off, if you have not been recording your expenses and earnings, you need to start doing it. You cannot control your spending if you do not know where your money is coming and going. Get a ledger, notebook, computer spreadsheet, or whatever you prefer and keep precise details about how much money was spent or received, where it came or went, what the money was spent on, and when the transaction occurred.

Did I go over? As you look back over your past budget, you need to point out the times when you spent too much. After you select these dates, you should ask yourself why you went over the limit. Was it necessary to go over budget? Could you have prevented this? Is there a recurring problem that caused this? Take a deep look at when you overspent, and try to devise a plan so this will not happen too often. You should find a way to most appropriately spread out your cash.

Did I spend too little? This may seem like a ridiculous question, but some people become so worried about going over budget that they hold back on things they really need. Of course if you are trying to save money, having a conservative spending style will help store up some reserves. However, this should not reach the extreme of cutting out necessities. Make sure to check that your budget is an appropriate balance of conserving and spending.

Do I have a system? When you make payments throughout the month, how does it work? Do you have an idea of how much you will spend within a given time frame, or do you just pay as you go? Instead of simply spending money and hoping it stays within budget, you can make future plans for the money to ensure that it will go as far as possible.

There are many categories of expected expenses. You know you will have to pay a fixed amount for rent, car payments, and so on. Figure out where your money will go consistently. Then set aside a certain portion for unknown costs, entertainment, clothing, etc. The more you plan ahead, the more you can control your spending. Setting fixed amounts will guarantee that you are staying on track. You will be less stressed financially if you can stay close to your budget.

Have my circumstances changed? Depending on your situation, you may need to factor in other variables when you make the budget this year. A handful of things could have come up over the past year such as marriage, having kids, or a job change. Just make sure to make the appropriate alterations for anything that has come up, and try to diligently plan what you will need for each new circumstance.

These are a few of the many questions that you can ask yourself when you start making a new budget. Do not think that remaking your financial plan is a once-a-year endeavor. Every month, you should look over it to see if you have been following your plan precisely, and whether it has been working well. If not, make the proper changes. In the end, by taking the extra time to make a well balanced plan, you can live a more stable and reassured lifestyle.