How to Create a Personal Budget

The reason most people ask themselves at the end of the first week of the month “where did all my money go?” is because they didn’t “send” it anywhere. They just let their money wander off. Irresponsible, init?

By creating a personal budget, you need not ask yourself where your money went.


Because you’d know – miglior marsupio neonato per i giovani genitori.


Because you had purposely sent it there from the beginning.

And that’s why we hope to take you through the different ways to create a personal budget and stick to it.

The first thing you need to know is the 50/30/20 rule…

If you’re not aware, this popular rule is one of the ways to break down your budget. In essence…

  • 50% of your income goes to your living necessities such as accommodation and utility bills.
  • 20% goes to financial goals like retirement savings, paying off mortgage, loans, etc.
  • And 30% goes to other wants like charity, donations, entertainment, etc.

Now, keep in mind that this rule is just a starting point – something to give you a basic idea if you don’t know how to start. It can always be adjusted to your own peculiar situation.

For instance, if accommodation is cheap where you stay, 50% might be too much to dedicate to living necessities, while some other areas might demand more. You get the idea?
That said, here’s how you can plan your personal budget …

1. Calculate: Know where all of your income comes in from monthly and what they amount to altogether. This should be excluding necessary deductions such as taxes, social security, etc. That final figure is what you’ll be budgeting with.

2. Track: First things first, list your fixed expenses like rent, car payments, and utility bills. You can hardly cut back on these but if you know how much goes to them, you’ll know how much you have left. Next, calculate the variables. Check through your bank and credit card statements to get an idea of your average monthly expenses.

3. Set SMART Financial Goals: Specific. Measurable. Achievable. Realistic. Time-bound. Your financial goals, whatever they are, must have these qualities whether they are long-term or short-term.

4. Plan: Armed with the information you’ve garnered, draw up a plan. The 50/30/20 rule can give you a good place to start. Be as specific as possible and leave no stone unturned in your planning. Plan down to how much gasoline it takes you to get to and from work daily.

5. Adjust: This is the hard part. You need to know your wants, your needs, and the difference between them. An honest evaluation of this will help you adjust your budget accordingly.

6. Review: Always check in with your budget throughout the month to see how you’re doing and what needs adjustment (migliore centrifuga).

One final thing though, all we have said will only be achievable if you document. It won’t work in your head. Although we didn’t cover that in this article – it’s a long process in itself – learn how to budget using a spreadsheet.

Another idea might be to get a budgeting app.

Whatever you do though, ensure that you retain the control of your money. You’ve earned it. You deserve that much.