Several weeks prior to the beginning of 2010, I read an article by financial columnist Humberto Cruz of the Chicago Tribune.   He stated that if you have never written down your daily expenditures you should try it to see where your money is really going and what better time to start than the beginning of a new year. It was simple. Write down every penny you spend each day (even for a pack of gum), tally the results at the end of each week and total them at the end of the month. The key is to be consistent. I decided to try his plan because since I am no longer working I need to be much more aware of where my money is being spent. I am not referring to monthly recurring bills like my Cobra insurance, but shopping trips to the grocery store, lunches out with friends, visits to the beauty shop, gifts, plus all the little expenses that happen whenever you venture out of the house.

When I had a job, 15% of each pay check went directly into my 401k

I am embarrassed to say that I have never followed a budget. Somehow there was always enough going into my checking account that allowed me to spend what I chose to and still save for my retirement. I was disciplined in putting 15% of my pay into my 401K while working for a major hospital corporation. I invested wisely and benefited from the market boom years. As soon as I was eligible at my last job, I made do with less money each pay period but once again put 15% into a 401K. Now that I am no longer working, I must rely on Social Security and my savings to supplement what I need each month so not only am I interested in knowing where and how my money is being spent, it is imperative.

My new job is to create and follow a reasonable retirement budget

After only one week I was shocked. It is amazing how quickly small amounts add up to large sums. I was living in blissful ignorance. Now that I know I have to write down what I spend I think twice before making any purchases. With retirement comes stricter fiscal responsibility and as I am quickly learning it is tougher than you think.