This is SERIOUSLY cool.
Step 1: What you will need
Scissors/Stanley Knife (or Xacto knife, I think, in the US).
Needle and thread (preferable similar colour to the stitching of your jeans, but it doesn't matter. White, yellow or blue look the best). Or a sewing machine, if you know how to use one.
Something to mark your jeans with (optional).
An old pair of jeans that you no longer want to wear (or that you don't mind looking like a prat in afterwards).
A belt that you don't wear.