The headlines look ominous: skyrocketing gas prices, faltering job stability, hikes in food costs. But don't panic! "Recessions can be a good thing," says Anya Kamenetz, author of Generation Debt. "They can force us to break bad habits—overusing credit, buying houses with little money down and spending frivolously." You don't have to ditch vacation plans or sacrifice your favorite splurges to tighten the purse strings. Keep your finances in check with these four tips.

Draft a Budget
"Tracking monthly spending keeps hard-earned dollars from dribbling away on junk and helps you get what you really want," says Liz Pulliam Weston, author of Easy Money. When you see exactly where your money goes, you can instantly spot where to cut back.

For example, maybe you spend $5 on two lattes every workday. When that appears as $100 on your monthly budget, you may decide you'd rather put that money toward a spiffy mountain bike or new pair of shoes. Even if you decide that the caffeine kick is worth the cash, at least you're making a conscious decision.