30% – Housing
30% of your income will go to housing. Make sure to take a look at your incoming money, so you can cover your mortgage or rent. It is best to go over these numbers before signing a lease or buying a house. If you are following the 30-30-30-10 budget rule, be sure to divide your income up so you can afford 30% for your rent or mortgage.
30% – Necessities
This portion of your budget will include groceries, clothing, school supplies, transportation, utilities, childcare, and any other necessities you must keep in your budget.
30% – Financial Goals
What are your financial goals? If you are trying to pay down debt, saving for retirement, build an emergency fund this money will help you save. Start by setting up monthly financial goals and then add yearly and lastly a five-year financial goal plan. You can start investing or if you plan to retire soon, write down how much you will need and start saving for your future.
10% – Fun Money!!!
Fun money can be used for entertainment such as going out to eat, festivals, concerts, or to the movies. You can also save some of your fun money to plan a vacation and budget a little each month so you can afford to go somewhere fun.
30-30-30-10 Budget Example:
To make it easy, let’s use $2000 as your monthly take-home pay or your “gross income.”
With the 30-30-30-10 budget rule, you would set aside $600 for housing expenses (30%).
Allocate $600 for financial goals such as debt retirement and investing. (30%)
Also, you would budget $600 toward your necessities (30%).
Lastly, $200 would be leftover to go out and have some fun! (10%)
This is a simple example of how the 30-30-30-10 budget rule will be utilized with a monthly income of $2000. As you begin to create your budget, use your own income and begin dividing your categories accordingly.
Grab your budget freebies here:
How to Budget Using the 30-30-30-10 Budget Plan.
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