We have been using Dave Ramsey's Total Money Makeover as our plan for some time now. We set up monthly budgets and are eliminating debt to free up cash flow for other things later.

Also, yes you DO need to budget for car repairs. You also need to budget for house repairs, appliance replacement, the holidays, birthday gifts, trips and pretty much everything else. Sorry that you don't like it, but that's how it is. You only have so much money coming in and you need to know how it's going out. Hoping the car will somehow run forever and praying the furnace lasts another year aren't going to get the job done.

The flip side, of course, is that you don't need to buy the cheap toilet paper or give up mojitos, or even clip coupons. Budgeting is anticipating where your money will go, and prioritizing what is important -- and it's separate from frugality and/or being cheap. We also have what may be considered an "adult allowance" in our budget that we take out in cash every month and are allowed to spend however we want -- dinners out with friends, gadgets, books, coffee, etc. It allows us the freedom to spend without approval, but also allows us to budget for the amount.

Hey there, a dad here. I am doing this now at our home and my wife seems to prefer that she stay out of it, as money stresses her out to no end. That's okay though - I dont mind the late night sessions at the computer with Quicken, Quickbooks and excel worksheets. I started by purchasing Quicken and downloading about three months of transactions into the program from all my accounts and have categorized them all. Based on this, I am looking at how I have spent my money so I can determine what my "budgets" are now and then how they should be adjusted. The budgets tool in quicken is not that great - surprisingly hasnt been updated in about ten years but I couldn't find a better option (I tired mint.com and its lame).

We have a third child on the way, upcoming maternity leave (unpaid) and a seasonal business that all demand we start being more careful with spending. Oh and we need to buy a minivan! We are using this information to decide what our childcare plan will be this fall and if I can afford leather seats.

I second J's comment. Dave Ramsey's approach is not gimmicky or fad-based where people try to "trick" their way out of financial peril/doldrums, but rather is the application of is a combination of common sense and decades of experience. He a radio show that runs daily where he takes and answers calls from those with financial questions. Highly recommended! Dave provides a step-by-step approach to achieving 'financial peace'. An hour of the radio show is also available as a free podcast on iTunes every day.

To touch on your point about car repairs, one of Dave's steps is to build up an emergency fund. Low-probability, high-impact events (such as car repairs or hot water heaters leaking). do occur, and more often than not, when it rains, it pours! Too many people rely on credit cards in such times, increasing stress by going into debt (at outrageous interest rates), rather than having the peace of mind provided and independence provided by having your own emergency fund.