Calculate your monthly average monthly income
First you need to determine what your yearly income is and make a rough estimate how much you earn every month. You might be on a job which salary varies every month. Make a rough estimate of your monthly salary available.
Figure out your monthly spending
Next you need to determine where your money is going i.e. your monthly spending. You should take into account if you go out with friends, how much you spend. Also what bills you are giving every month and if you watch movies with family and friends, how much it costs. By this you can battle handle the budget.
Now you need to create a budget. Jolt down what you pay every month. You have to write all rents, electricity bills and other bills. Then set a budget stating your short term and long term goals. You need to set the number of money you can spend every month. Long term goals include mortgage payments and house or car loans.
Minimize cost activities
You need to reduce cost activities i.e. you should opt doing for free rather spending money. For gym memberships, you can lower it for jogging or walking purposes only. In case you visit a gym for aerobics, you can always get a DVD and workout at your home with friends.
You need to change how your shop i.e. you can visit stores which offer discounts on different household items. Also you can join discount clubs and buy in bulk for less.
Use home appliances when needed
You should optimize your utility usage i.e. you should turn on things when required such as air conditioner. Also limit its usage and run for a set number of hours. You can keep blinds close in day so your house stays cool. In night you can open windows to have fresh and cold air. Similarly you can use a dishwasher when it is used and not for few dishes only.