What Is The Best Budgeting Method For My Needs?

If you’re looking to create a budget for yourself but you aren’t sure where to start, then you’ve come to the right place. Budgeting has never been a one-size-fits-all endeavor. There are many budgeting methods out there that can work for your lifestyle.

Let’s dive in and check out some of the most popular budgeting methods

50/30/20 Method

The simplest method is the 50/30/20 budget:

• 50% of your budget goes to necessary expenses (rent, food, etc.)
• 30% of your budget goes to discretionary expenses (vacations, nights out, etc.)
• 20% of your budget goes to debt repayment and savings

This method is wonderful for new budgeters, as the percentages can be slightly adjusted depending on your preferences or needs.

Pay Yourself First Method

What Is The Best Budgeting Method For My Needs

This method prioritizes debt repayment and savings. You can choose how much you want to pay off your debt and savings with this method.

Once you’ve repaid debts or tucked funds into your savings account, you’ll then have the freedom to use the rest of your income however you desire. Of course, you’ll still need to make your basic needs a priority, though knowing you have your long-term goals under control can be helpful.

Zero-Based Method

People with a set monthly income will often use the zero-based budgeting method.

With this method, you total your monthly income and subtract your savings and expenses.

So, for example, let’s say you make $4,000 per month. You spend $1,000 on rent, $500 on food and other necessities, $400 on debt repayment, $200 on car insurance, $200 on utilities, $200 on medical expenses, and $500 on savings.

When all is said and done, you’ll have $1,000 to spend on anything else you’d like for the rest of the month.

No Budget Method

Some like to take a more freeform approach to budgeting if the above methods feel too restrictive.

You might try this no-budget method, which involves tracking your spending closely to ensure you’re on the right track. With this method, you can always make sure that you have enough funds in your account to cover any bills you might have.

Regardless of the method you choose for your budget, it may take some time to see the positive results. However, we promise that if you stick to it for a few months, you’ll be able to see how beneficial it can be for your financial goals.

Final Thoughts

As you can see, having a budget can help you with your long-term goals.

Of course, beyond using regular budgeting methods to better your financial life, you can use potentially-credit-boosting tools like tradelines.

Here at Personal Tradelines, we’re all about making sure our customers are confident throughout the tradeline buying process. We’re here to provide all of the necessary knowledge so that you can find the tradeline that fits your situation best.

Make sure to get in contact with us when you are ready to take the first step toward great credit!