Paying off any debt (credit card bills, loans, etc.).
So, whenever possible, 20% of your income should be put towards: After a few years of scrimping and scraping together whatever money you can, you can look at your savings account balance and give yourself a much needed nod of approval. But, while putting any extra dollars and cents into your savings might not seem like much help, especially when you have debt to pay off, little by little it all adds up. When you’re not making as much as you’d like at work, using up 50% of your hard earned income on the things that will literally help you live can be a bit tedious. This category is one that you’ll learn to love when you really start being able to save money properly and work towards securing a healthy financial future. Interested in learning more budgeting basics? Click here. Don’t worry though, living on your own will help you learn to get your spending under control, so that you’ll have enough set aside for the next two categories. With gas prices always dropping and rising, it’s a little more difficult to determine how much you’ll be spending on your car every month, not to mention any repairs that need to be done. And, while public transit costs are easy enough to calculate (fares might jump up by $0.25 every other year), the cost of owning a car is not. There’s nothing wrong with splurging on your favourite snacks every once in awhile, but when you’re trying to stick to a budget, it’s best to do a bit of adding and subtracting before you get to the checkout line. However, just remember that while your rent/housing costs and utility bills won’t change too much, give or take a slight increase from year to year, the other essentials, i.e. Simple enough, right? Once you’re earning a regular monthly income, it shouldn’t be too hard to calculate half and put toward covering the necessities. This means, 50% (less if you can manage it) of your monthly income should be going towards the essential expenses, such as: It’s up to you to handle all those expenses now.
Budget percentages guidelines free#
No more relying on your parents for food, gas money, and a free place to live. This will obviously become the biggest portion of your budget. The things that you absolutely must have in order to get by on a daily basis.
Let’s take a look at how the 50/20/30 Rule can help. When you’re a young adult, you might not be able to find a job with a reasonable salary right off the bat, so budgeting wisely and knowing where every dollar you have is going will become extremely important. The principle itself is simple enough: divide your income into three categories so that you can live your life to it’s fullest while maintaining a proper budget and still having enough left over for the future. This is where the 50/20/30 Rule might come in handy. True, the process of making a budget might be a bit stressful, especially when you have all those costs written down in front of you, but eventually, it’s going to help you get your bearings and really learn to live within your means. So, get out your notebook or budgeting app and start making a note of every expense you have. No better time to become a math and finance whiz than when your living situation depends on it. Trying to force yourself to start budgeting properly? Maybe you’ve just moved out and are living on your own, which is always a good motivator.
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