How do you budget your life?

[Kevin Lee]

I'd like to ask how you financially budget your life for success? For instance, what percentage of your paycheck goes to what and how much discretionary income (% wise) are you left with and a monthly basis? More importantly, how much do you try to put away for long-term savings?

e.g.

Break it down by individual items:
-% Home mortgage
-%Car lease & insurance
-%Food (groceries)
-etc...

OR

Break it down by just fixed expenses, savings and discretionary income.
-70% Fixed expenses
-10% Long-term savings
-20% Discretionary income for fun stuff

[BizLoanz4u]

Listing individual expenses is a bit too personal for me because it would pretty much identify income.

I suppose I would feel more comfortable just saying I put 5% towards long term savings, 80% is fixed and 10% is miscellaneous (personal expenses) and 5% is for business expenses (little to no overhead) just some advertizing and some home office items to purchase from time to time, such as ink cartidges, paper, envelopes...etc. (Everything I do is pretty much electronically, phone or fax).

[Kevin Lee]

Finance guru, Gail Vaz-Oxlade and host of Slice tv's show Til Debt Do Us Part says a person needs to save at least 5% of their income, but ideallly 10%.

Moreover, Gail says "The financial rule of thumb says you shouldn’t spend more than 35% of your net income on housing. (That includes mortgage/rent, condo fees/maintenance, property tax and utilities.) If you’re spending more than 35%, either you can look for ways to cut back on your housing costs, you can make more money, or you can trim in other areas (like transportation) so you end up balancing at the bottom line.

It’s your money. You can do anything you want with it EXCEPT spend more than you make."
http://www.gailvazoxlade.com/articles_f/article31-2.htm

I also think that she mentioned in a particular episode that you should only allocate 15% of your monthly income on your car and 25% on life expenses (i.e. food, clothing, entertainment)

[David Castro]

Saving 10% of income is a great goal, I save as much as I can and don't really put it as a percentage. but maybe I should, to be more strict. I wonder what percentage people spends on gas now days

[Kevin Lee]

Saving 10% of income is a great goal, I save as much as I can and don't really put it as a percentage. but maybe I should, to be more strict. I wonder what percentage people spends on gas now days

There's a lot of talk in the news now about people trying to sell or trade-in their SUVs due to the high cost of gas. However, some experts on news channels say that it's still cheaper to keep your gas guzzler than to buy a new car.

[OmnivoreInk]

I know the advice is that, as soon as you get your paycheck, you "pay yourself first." In other words, put 10% into savings immediately.

Then the rest of the money is yours to spend.

I haven't always been as financially responsible as I am now..... (wish I knew then what I know now!) but now I do the whole bit, investing, savings account, etc.

I don't go in for a lot of toys.... a wii would be cool but I don't need it, etc. I go shoppoing and buy books, since as I work from home I dont' need no stinkin' wardrobe!

[orxan]

Here is my financial management categories for today:

15% Long Term Savings;
10% Home Expenses;
45% Business and Marketing charges;
10% Friends (Meeting);
20$ Scientific and Law Books.

But this will change when it is August or September.

Orxan

[ideasuniversity]

The only two things that are constant on my budget after rent and food are, tithe and savings. 10 percent go savings and 10% goes for tithing.

[lisa]

Follow a simple rule; avoid spending on unnecessary things. Set a target for savings, ideal would be 10% of your income (this is what i do personally). Get control over your financial transactions- track every dollar earned and dollar spent. If it's ok with you, you could use Budget planning software.

[GT Bulmer]

Follow a simple rule; avoid spending on unnecessary things. Set a target for savings, ideal would be 10% of your income (this is what i do personally). Get control over your financial transactions- track every dollar earned and dollar spent. If it's ok with you, you could use Budget planning software.

Hi, lisa:

You have provided an excellent list of how to budget: there seems to be two key priciples - control and planning.

The best planning and budgeting concept I have seen (and sometimes follow) to help plan for the future is "Pay yourself first." Decide on a dollar amount or a percentage, then on "payday" the first thing you do is put that amount into a savings account that you have mentally blocked yourself from accessing for anything but the intended purpose. Do not consider it an emergency fund or a rainy day fund. Keep it as a retirement fund that you cannot touch for anything else.

If there is something you want to buy - a major expense, that is - you can do the same thing. You can "save up" for it by determining how much you can put into a special, untouchable savings account each payday. Then, on payday, "pay yourself first" and do not touch that money for anything else.

Most often, when you pay yourself first, you can then go on to "live on" whatever you have left until next payday. That is, of course, if you have control over your other spending and try to avoid buying things on credit.

GT

[lisa]

The best planning and budgeting concept I have seen (and sometimes follow) to help plan for the future is "Pay yourself first." Decide on a dollar amount or a percentage, then on "payday" the first thing you do is put that amount into a savings account that you have mentally blocked yourself from accessing for anything but the intended purpose. Do not consider it an emergency fund or a rainy day fund. Keep it as a retirement fund that you cannot touch for anything else.

If there is something you want to buy - a major expense, that is - you can do the same thing. You can "save up" for it by determining how much you can put into a special, untouchable savings account each payday. Then, on payday, "pay yourself first" and do not touch that money for anything else.

Every person has to keep retirement fund . "Pay yourself first" this will be the best method for future and retirement planing.

[partners]

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[GT Bulmer]

Hello:

Mine currently appears to be a deficit budget; robbing Peter to pay Paul. It's kind of like the old Seinfeld show where Jerry says something about how "night guy" wants to stay up and party, but "morning guy" always pays the price for it and as a result, ends up hating "night guy."

GT

[ideasuniversity]

Saving 10% of income is a great goal, I save as much as I can and don't really put it as a percentage. but maybe I should, to be more strict. I wonder what percentage people spends on gas now days

I believe strongly in Saving 10% of my income too. This is what I learn from the book."The Richest Man in Babylon"

[GT Bulmer]

I believe strongly in Saving 10% of my income too. This is what I learn from the book."The Richest Man in Babylon"

Hi, Yinka:

"The Richest Man in Babylon" is one of my favourite inspirational business books, too! I have an old copy on my bookshelf, although I haven't read it for a few years.

GT