(Finally) building a budget. I know it would be unreasonable to say that I won't spend anything on frivolities, but I have to be honest with myself and build a budget that is realistic and attainable.
I find the budgeting process should start by tracking spending, every last dollar for a bit of time, even a year to be sure to get through the seasonal items that aren't monthly. Even then, you won't have the new car tires (I just needed a set, $700, after 40K miles / 64K Km.) this exercise will help you identify the non flexible expenses, mortgage, property tax, utilities, as well as those you might impact but with effort, such as the grocery bill. Last comes the really discretionary spending, the eating out, the gadgets, the movies for $75 for 4 vs $4 for a stay at home pay per view.
In the end, the money isn't unlimited, so it's a matter of priorities. Me, I love to cook, and would rather cook for 6, and have people over than to pay the restaurant prices. I'll still eat out, but pick and choose to go for meals I can't make myself.
How much have you been spending? I took that number and shaved a bit off so it would be a challenge but not impossible to obtain. I also tried not to limit my kid's fun because I want to save money.
In our house, for our area and our idea of fun, we budget almost $200/month. That really might not do for a larger family with older kids though.