Have you ever overdrawn your checking account without even knowing it. After all, two weeks ago you had plenty of money.

Where did the money go?

There are plenty of people who reach the end of the pay period anxiously looking for the next paycheck in the mail. There is a simple way to prevent the stress that comes along with living from paycheck to paycheck -- budgeting.

Budgeting is a simple way to control your money so that it no longer controls you.

The first thing you have to do is know where you are spending your money. For two months, keep close records of every single penny you spend. You don't have to walk around with a little notebook keeping a close record. That doesn't really work in the real world. Just keep your receipts for all of your cash spending. Your checkbook and bank statement will take care of the rest of your documentation of spending.

Sit down and look at where you have spent your money. You may be surprised. You could be spending hundreds of dollars on coffee each month, never noticing how it all adds up.

Make a list of the categories in which you spend your money. Write next to each expenditure whether or not each item was necessary. This will show how much money you have to have versus how much you simply fritter away.

Once you know where your money is being spent, you can create a budget. Gather your spending list, your bills and your checkbook register and make a list of all your spending by category. You may have some of the following categories in your budget: food, dining out, household expences, auto expenses and so on.

Include your debt, such as credit cards and student loans, and your interest rates. This gives you a complete and honest look at your finances. You can use a pen and paper or a computer program to enter in your numbers.

When you are finished, you will see where every cent of your money is going each month. Now subtract the final amount from your total income. You should have a positive amount left over each month. If you don't, you need to start changing your spending habits right now.

Start with setting a goal. Do you need to save, pay off debt or have more spending money? No matter what the numbers are, a budget can always be improved.

Martin Lukac, represents http://www.RateEmpire.com, a finance web-company specializing in real estate/mortgage market. We specialize in daily updates, rate predictions, mortgage rates and more. Find low home loan mortgage interest rates from hundreds of mortgage companies! Visit http://www.RateEmpire.com today.