You can start by simply using excel. You can start by looking at your prior month spending and using that as a baseline for creating your budget. You can create categories to group your expenses into and decide how much you want to spend on those categories. At the end of each month you should go back and see how much you spent on those categories and see if you were able to stick to your budget. It may be hard at first, but if you hold yourself accountable, it will become easier with time.
If you want to make it even easier, their are great apps that you can use to help you. I like the app Mint which I link to my bank account.
Hi Van, I recommend using the budgeting feature within your bank's app. Banks have been working on enhancing this budgeting feature within their apps and I find it convenient to have all your banking details in one app. You can set spending limits on categories of expenses (bills, gas, groceries, restaurants, etc.) and see how well you stay in budget. This budgeting takes some time upfront to set the limits and determine your applicable spending categories, but I find that the best way to budget is just to get some numbers down and have a visual of how you're doing compared to what your expected budget is.
This budgeting allows you to compare total spending month over month to see how you're trending, and if you have a month of particularly large spending or large saving. These apps usually have a feature that allows you to create a sort of bucket, within your savings or checking account, that you can set aside money for something you want to save for (i.e. a vacation).