![]() If you haven’t yet, download the Master A Budget Workbook to practice what you will learn from this series. Next up on the series is everything you need to know about Emergency Funds and Sinking Funds. 50/30/20 Have you heard of this one before This budget is where you put 50 of your income towards your needs like housing, food, utilities, insurance, and transportation, 30 of your budget towards wants, and you put 20 of your budget towards saving and debt payment. Remember, your financial situation is different from anybody else, so don’t be afraid to make adjustments so that it will align better with your financial goals. Let’s compare those other budgeting methods to the Dave Ramsey budget. While it's similar to Dave Ramsey budget percentages, it is much more simplified. 20 of your income goes to investments or bank accounts. Those are the budget categories and percentages that you can use to craft your budget. The 70/20/10 budget (or rule) is as follows: 70 of your income goes to living expenses. IRS Final Thoughts on Budget Percentages And Categories For A Personal Budget.I usually refer to my budget categories when I was doing the cash envelope budget system. Not all of them are applicable to you so only pick the ones that will work for your family. Here are the Budget Categories that you can include in your budget. ![]() If you keep your eye on the prize, then you will know how to perfect your budget. You see, everyone’s financial situation is unique but the most important thing is to focus on your goal. For example, if your financial goal is debt freedom, then you might focus more on paying off your debt rather than saving for a vacation. You still need to tweak them to fit your unique financial situation. Once you get the hang of it then you can start going into more detailed budgeting.īoth of these budget percentages have their advantages and disadvantages. The 50-20-30 Budget Rule is best for those who are new to budgeting because it is easy and simple to follow. This includes vacations, dining out, entertainment, shopping trips, and other luxuries. 30% to Wantsģ0% of your income will be spent on the things you want to do but you can live without, otherwise known as fun money. The 20% of your income will be spent on funding your emergency fund, retirement, student loan payment, personal loans, and credit card payment. Half of your income will go to areas that you cannot live without and that includes housing, food, transportation, utilities, and healthcare.
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