Utilizing one simple, yet powerful tool could make all the difference in the world for your financial future. Knowing how underused this tool is among American households makes it easy to understand why so many are in financial trouble.

What if I told you there is one very simple, yet powerful tool you can begin using today to make a significant impact in your family’s financial future? Would you be interested in learning more?

The reality is that a majority of Americans are in financial trouble. Everything from student loans to credit card debt is keeping Americans from reaching their financial goals. And, for some, it is keeping them from even saving money on a regular basis. A recent survey found that 33% of Americans have no savings at all, making them prey for financial shock.

But it is possible for all that to change with just one simple, yet powerful tool that can be implemented into any household today. That tool: a budget.

Did you know that only one in three Americans prepare and follow a monthly budget? That is according to a recent Gallup poll. It’s no surprise that so many are on the brink of financial ruin. The most basic, and powerful tool needed to avoid massive debt, save for emergencies, and prepare for retirement is going ignored by most Americans.

Ok, so you haven’t made a budget, ever. And you now realize its time to take this step in your financial education in order to properly prepare for today, and the future. Now what?

I’m glad you asked. Preparing a budget is not nearly as daunting as people pretend it is. As a financial professional I help people create a budget all the time. The funny part is that when I’m done I almost always hear “that was really easy.” That’s because a budget is nothing more than a simple calculation of what comes “IN” and what goes “OUT.” To do this, you need only to draw a line down the middle of a piece of paper and write “IN” on one side and “OUT” on the other.

Under the word “IN” you simply list the amount you will be paid in a month’s time. Now, this may or may not count variable income. Perhaps you get commissions, or bonuses during a given month. You can list those if you like, but it is better to start by listing what you know will come in each month. Then, on the other side of the paper you list the things you have to pay. This might be things like your mortgage, car payment, electric bill, cable, Internet, and cell phone bill. Once you’ve listed all the things you have to pay its time to list the things you should pay.

Things you should pay include putting money into an emergency fund, IRA contributions for additional retirement money, and being intentional about saving for large future purchases such as a refrigerator, vacation, or car. And, if you have kids it would be wise to put money aside for college funding. That doesn’t mean you have to pay for 100% of their college education, but saving to help with some of that expense is a good idea.

Now that you have listed the things you have to pay, and the things you should pay for, all that is left is to do a basic math calculation. Subtract the total on the “OUT” side from the total on the “IN” side. Ideally, there should be something left. The goal is to have more coming in each month than going out. If you find that you can’t pay for all the things that need paid for in a month’s time with what is coming in from your employment, it’s time to make some decisions.

You are now at a point when you need to think about cutting costs. What can be trimmed? What expenses are not necessary? Finding areas of your budget to downsize and trim will be helpful in making sure you are prepared for the financial challenges of life.

One of the biggest pitfalls I see in younger generations when it comes to money is a lack of patience. Many people in their 30’s-40’s look at what their parents have and want that too. They see a nice house, new car, vacations and trips, and eating out all the time and want to mimic that lifestyle. The problem is that they don’t remember when their parents were younger (raising them) and had nothing. They forget that their parents didn’t wake up one day and have a lot of money and live this lifestyle. It took years of careful saving and wise money management to get here.

If you want to enjoy a financially secure life one day, it starts today with wise money habits. It starts with creating a budget to follow each month that will help you save and be prepared for financial emergencies. It starts with living simply now so that you can live how to desire later in life. It starts with ignoring all the commercials and ads for new gadgets and stuff that you can live without.

Financial success is not an accident that happens to some people. And it’s not a result of making a lot of money for many years. Financial success is a result of careful financial planning and wise money habits. But with a little planning and some intentional living, you can enjoy a financial future unlike many others.

For more information on starting a budget check out this great article on budgeting for beginners. There is some practical advice to help get you started.

Once you’ve gotten started with budgeting and being a wise money manager, start thinking about the kind of retirement you would like to have. Don’t wait until you are ready to retire to think about it, start now. You can read this simple article on different ways to calculate your retirement and determine how much you will need to retire.

The bottom line is that your money is your responsibility. You have to make an effort to be prepared for life’s financial challenges. Don’t ignore this tremendous responsibility until it’s too late. Start taking small steps today to make a difference tomorrow.