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USE THE ENVELOPE SYSTEM TO TARGET YOUR BIG WINS All this conscious spending and optimizing sounds nice in theory, but how do you do it? I recommend the envelope system, in which you allocate money for certain categories like eating out, shopping, rent, and so on. Once you spend the money for that month, that's it: You can't spend more. If it's really an emergency, you can dip into other envelopes at the cost of spending in that category. These "envelopes" can be figurative (like in Kublax or Excel) or literally envelopes that you put cash in. This is the best system I've found for keeping spending simple and sustainable.

Forget budgeting. Instead, let's create a Conscious Spending Plan. What if you could make sure you were saving and investing enough money each month, and then use the rest of your money guilt-free for whatever you want? Well, you can--with some work. The only catch is that you have to plan where you want your money to go ahead of time

MONTHLY FIXED COSTS Fixed costs are the amounts you must pay, like your rent/mortgage, utilities, mobile phone, and student loans. A good rule of thumb is that fixed costs should be 50-60 percent of your take-home pay. Before you can do anything else, you've got to figure out how much these add up to.

Rent/mortgage Utilities Mobile phone, landline Insurance, bills Car payment Public transportation Loans Food Clothes Internet/cable