Hey everyone,
I’ve been trying out the 50/30/20 rule for budgeting for a few months now, and it’s not quite working perfectly for me. Don’t get me wrong, it’s a great starting point, but I feel like my needs are a little different. For example, I have a student loan payment that eats up a bigger chunk of my income than 30%. Are there any other budgeting methods out there that people have had success with? I’m open to anything that might help me manage my money better and reach my savings goals.
hi ethan!
It sounds like you’re dedicated to finding a budgeting method that fits your personal financial situation, which is commendable.
The 50/30/20 rule is a solid framework, but it’s not universally applicable, especially when you have significant expenses like student loans.
Here are a few alternative budgeting strategies that might resonate with you:
This approach requires you to give every dollar a job until you have zero dollars left to assign.
It’s a meticulous method that can help you track where every penny goes.
If you prefer a hands-on method, the envelope system could work well. You allocate cash for different spending categories into physical envelopes.
When an envelope is empty, that’s your cue to stop spending in that category for the rest of the month.
This simplified strategy involves saving 20% of your income, while the remaining 80% covers all your expenses.
It’s particularly useful if you’re aiming to ramp up your savings.
This method suggests limiting your essential expenses to 60% of your income, including taxes, living expenses, and debts.
The rest is divided among retirement contributions, short-term savings, and discretionary spending.
Experimenting with these methods may require some adjustments, but finding the right one can significantly enhance your ability to manage your finances and achieve your savings goals.
Have you tried the 70-20-10?
The 70-20-10 budget rule means spending 70% of your money on needs, saving 20%, and using 10% for fun.