Wow, almost everyone I know is broke! And I mean everyone! I have friends who earn a lot, and friends who earn a little, and they all have one thing in common. They are broke. They have tons of debt. They do not have budgets, and they do not know “where their money goes.” They are not planning for retirement, they have too little insurance, and they live pay-check to pay-check. Seriously, regardless of income, all of my friends struggle with their personal finances. I have had the opportunity to “council” a few of them, and here are the words of advice that I give. Some are starting to take this advice, others are pondering it, and still others ignore it. (By the way, I NEVER offer financial advice to friends… They just know that I have this “thing” about money, so they come to me. This is pretty strange, seeing as how I too was limping along until last April. Cool)

So, here is my basic advice for the financially “out of shape.”

• Stop. Stop everything you are doing, for one day, with money. Don’t buy anything, don’t spend anything, don’t return anything, don’t plan anything. Spend one WHOLE day’s worth of free time not thinking about money. Clean your house, organize your office, play with the kids, do anything BUT think about money. You are about the embark on a radical life change, and you need a clean emotional state. Your financial problems did not crop up in one day, and they are not going away in one day.

• Analyze. Now, you are ready. Analyze your current financial situation. List ALL of your debts, all of your cash accounts, your retirement accounts, your bills, etc. Spend today’s free time reacquainted with YOUR personal finances. Find out who you owe money to, where your money is at, when your money will come in, and where your money goes out. This can be done on a simple piece of paper, or you can use your computer, whatever. You cannot fix your personal finance situation until you know EVERYTHING about your money. This is how you find out. You should end up with a piece of paper looking something like this:

1. Debt	Account	Date Due
   $100.00	CHASE	15
   $1,000.00	AE	15
   $1,000.00	BELK	15
   $230,000.00	MORTGAGE	1
   Cash On Hand	Account
   $1,100.00	Checking
   $1,200.00	Savings
   $200.00	Cash
   Bills	Account	Date Due
   $30.00	Phone	15
   $200.00	Electricity	8
   $120.00	Cable/Internet	8
   $150.00	Insurance	8
   $209.00	Groceries	Weekly
   Future Income	Account	Date Due
   $2,000.00	Dad’s Paycheck	1
   $2,000.00	Mom’s Paycheck	15

• Breath. Okay, now you have a clean workspace, and you know the basics of WHAT you are working with. Now you can begin to “game-plan” for your finances. Now you need to:
• READ. Now, if you had a “natural” love for personal finance, the you would not be in the position you are in, so you need a book or two that will educate you, inspire you, and, most of all, not BORE you. Here are some I recommend, in no particular order. I think you should buy them from Amazon (disclosure: I get a small commission off of each sale), borrow them from a friend, or get them at the library. All in all, these books will help you change your MINDSET about money. They will energize and focus a part of your brain which has been lying dormant for many, many moons. So read:

• Focus. You have, in just a few short days, analyzed your current financial situation, educated yourself so that you know more and more about saving money and getting out of debt, and prepared yourself for change. You know the “problem” and now you have the basic tools to “fix” the problem. So, GO TO IT. You are ready to conquer your debt.

Personal note here: I got tired of being in debt and broke all the time. (Peter was tired of reporting me to the police, and Paul was tired of receiving stolen goods… If you get that joke, you too are a dork!) So, I did these very things. I took a day off to just hang out, and prepare myself mentally. I cleaned out my offices, and I got myself organized. I wrote down my account numbers, balances, due dates, etc. I calculated who I owed and how often I owed them. I read Dave’s books (re-read, actually)…and then I GOT STARTED. Information without effort is USELESS.

Cautionary word: I AM NOT a personal finance guru, teacher, or guide. These are my opinions, and, while I think they are sound, they might just be ridiculous. If you follow any of the information or “advice” that you find on this site, you do so at your own risk. I am just a dude with a computer and some things to say.

Now, if you are ready to begin your actual budget, I HIGHLY suggest you check this product out from You Need A Budget. They are a sponsor of my site, and this Excel based budget program is WELL worth your investment.

Remember, this stuff can be as easy or complex as you make it. RULE of THUMB: It is never wise to jump head-first into something without understanding it…but it is even LESS wise to never jump head-first into understanding something. What?!? In other words, if you know you are broke, and are tired of it, get the information, the tools, and and the knowledge to DO something about it. FOCUS your initial energies on understanding WHAT to do, and the actual doing of it will become second nature. Feel free to comment with any questions or suggestion or problems.