If you have a financial issue that you would like help with, email me your name, location and describe the problem.

I’m not a CPA or financial planner, but I know a lot of practical tips from writing about personal finance the past year and  half. I’m starting with myself to give you an idea!

Name: Julia and Hubby

Location: Los Angeles, CA

Problem: We are good savers, putting aside enough to max out our Roth IRA’s every year, contribute to our 401 (k)’s, and have a small savings fund. But knowing we are saving so much gives us a feeling of financial safety, leading us to overspend.  Just yesterday I received a letter saying we bounced…… a check, which means we will have to draw from our savings to cover our bottom line.  Grrrrrrr.

How do we create tighter spending boundaries so that we stay within our means?

Solution: Create a simplified budget starting with monthly take home pay. Subtract monthly IRA contributions, same for 401 (k) contributions. Deduct other fixed costs like housing, utilities, savings, phone service, Internet/cable service, tuition, regular prescriptions and subscriptions. In other words, take into account every regular bill you pay.

The rest is your leeway. Memorize this number and write it down in an extra checkbook log or notebook you can carry around. Every time you spend, subtract the amount, whether it is a necessity like groceries or an extra like a plane ticket. If you can, spend just 80 percent of your leeway and save the rest for irregular expenses that pop up when you can least afford them.

As GI Joe said, knowing (your leeway number) is half the battle (to not spend beyond it).