What is The 50 30 30 Budget Rule
Budgeting is a core component of making it so that you never run out of money for as long as you live. A lot of people think that they just don’t earn enough from their salary to think about budgeting, but suffice it to say that you can make your salary stretch out for a much longer duration if you break it down and analyze what you are spending. A common way to spend money is to figure out what your expenses might be, but if you are spending every cent that you earn, you might not be left with anything that you can set aside for the near future.
This is where the 50 30 20 budget rule comes into play, and you should read more about it if you want to obtain more control about the direction in which your financial future might be headed. Not everyone is aware of this rule, and chances are that the same goes for you as well. We are going to outline this method so that you can avail the numerous advantages it can send in your general direction.
The way this works is that 50% of your income goes towards paying for necessities. After that, 30% of your income should be set aside for stuff that you want but don’t exactly need to survive. That can include some special and fancy clothes, or a wonderful vacation that can help you take the edge off. Finally, the last 20% should be reserved for paying off your debt, and after you have successfully rendered yourself debt free it should be saved by putting it into some kind of investment portfolio.