Top 4 Budgeting Methods for the saving

I know you are in thought that the end of each month where all your money goes out. Even worse is think about how all your money is gone when you still have a week left until salaries day.
If you’ve documented some receipts, for knowing! how much you spend on food, clothes or your kids’ activities.

A budget can help. Budgets are designed to keep you on top of the money that comes in and the money that goes out.

Budgeting Method No. 1: 50/30/20

Have you ever asked yourself how much you should be spending on necessities as opposed to the stuff you want? Have you think about what portion of your salary check should be going to better your financial future? The saving budget  might be right for you.

How To Use the saving budget method

Allocated your money so that 50% of your income goes to covering the necessary, 30% goes to buying what you really enjoy and 20% goes to meeting the financial targets.

Let’s say your take-salaries pay is Rs 20;000 per month. That breaks down to RS 12,000 for the essentials, RS 5,000 for whatever you desire and RS 3,000 for financial goals.
Some of the necessities you’d spend Rs 12000 on could include:

· Bank loan
· Insurance premium
· Homecare
· Internet expenses
· Phone EMI
· Minimum credit card payments
· Student loan payments
· Food/vegetables
· Floor rent
· Gas/cylinders
· Dining out
·  Family Vacations
·  Go for Movies
· Branded Clothing
·  Accessories{ mobile earphone,sunglasses,sleepers}
· Makeup kit
· Magazines
· Attends Concerts

That leaves you with Rs 3000 to put toward things like:

· Emergency fund
· Short-term savings
· Mutual funds by sip
· Extra payments on your credit cards

With the basic method, you don’t have to lay out how much you’ll spend in individual categories. For instance, you don’t need to set a spending limit on groceries or a cap on how much you spend on date nights as long as your spending stays within the established percentage brackets.
If you like the idea of the basic method but can’t stick to those exact percentages, you can also tweak the numbers a bit.

Is the 50/30/20 Method Right for You?

This method is a great fit for people who need guidance on balancing saving, investing and repaying debt.

If you tend to go overboard with your discretionary spending, this budget will keep you in line without making you feel like you have to sacrifice the things you want.

After all, 30% is a pretty generous allotment for fun spending.

Budgeting Method No. 2: The Zero-Based Budget.

How to Budget Using the Zero-Based Budget

The goal is to make sure your monthly income minus your monthly expenses (including allocations like putting money in savings or investment accounts) equals zero. There should be no money left over at the end of the month — and no spending more than you bring in.

To get started, analyze your bank statements, credit card statements and receipts from the past few months to get a sense of how much you spend in the budget categories that apply to your life.

Next, divide a spending limit to each of those budget categories. You may need to play around with the numbers a bit until the amount of money you have going out equals the amount of money you have coming in.

Its an example your budget may look like :

Income:

· Base  No. Rs 1: 10,000

· Base  No. Rs 2: 10,000

Total income: Rs 20,000

Expenses:

·  Floor Rent: RS 1000
· Insurance premium: Rs 1500
· Internet expedience : Rs 500
· Student loan installment -Rs 1000
· Student loan installment -Rs 1000
· Phone EMI: Rs 1000
· Family vacation : Rs 1500
· Health Insurance: 1000
· Vegetables : Rs 2000
· Gas cylinder : RS 1500
· Child school fee  : 2000
· Movies : Rs 500
· Gifts: 500
· Personal care items: 500
· Gym membership: 500
· Car/bike services: 1000
· Homecare: Rs 1000
·  Branded Clothing: RS 2000
· Savings: RS 1000


Total expenses :Rs 20,000

Is a Zero saving Budget Right For You?

The zero- saving budget is perfect for budgetary who want to spend about every rupee. It’ll help you become hyper-aware of your finances.

This budget may even chance for awareness about current financial condition  with zero saving budget in future your financial condition will be unstable you off to where you  — whether or not you are making a lot of money and spent much money on one budget category

Budgeting Method No. 3: explanatory Budget

How to Budget Using explanatory Budgeting

This budgeting method is pretty self-explanatory. With an explanatory budget, you cover only the expenses that are absolutely necessary. Whatever is leftover, you save.

Your budget might look something like this:

Income:

· Paycheck No. 1: Rs 10,000

· Paycheck No. 2: 10,000

Total income: Rs 20,000

Expenses:

· Floor Rent: Rs 1000
· Gas cylinder: Rs 1000
· Chide school fee : Rs 1500
· Internet:RS 500
· Student loan: 2000
· Phone EMI: Rs 1000
· Car maintenance: Rs 1000
· Vegetables : Rs 3000
· Gas: RS 2000
· Savings: Rs 5000

Total expenses Rs 20,000

Is explanatory budget Right for You?

The explanatory method is helpful for budgetary who are really looking to bulk up their savings — or perhaps aggressively pay down debt, this budget most suitable for the woman

The explanatory method can help anyone needing a spending reset. It really helps those people who are trying to  save money with a low average income

Budgeting Method No. 4: 60% gain

Sure, it’s smart to prioritize the essentials. But what about those expenses that aren’t important but that we consider very necessary to our lives? 60% gain gives value to that type of spending.

How to Budget Using the 60% gain

This budgeting method is similar to the 50/30/20 method, but the rules are a bit different. With the 60% gain, you’re budgeting 60% of your income on expenses you’re committed to. That includes essential spending plus those expenses that are most important to you, such as your kid’s activities, food expenses, dues to a professional organization or monthly road trips to visit loved ones.

As for the other 40% of your income? You can put that extra money toward savings or use some of the money for optional expenses. Richard Jenkins, the financial author who came up with the 60% solution, split his 40% into four 10% increments: retirement savings, long-term savings, short-term savings, and fun money.

Here’s an example of a budget that uses the 60% gain:

Income:

· Paycheck No. 1: Rs 10,000

· Paycheck No. 2: Rs 10,000

Total income Rs 20,000

Expenses:

Committed expenses (60%):

· Rent: Rs 1000
· food  : RS 1000
· Internet: Rs 100
· Student loan: Rs 1000
· Credit card debt: 1200
· Insurance: Rs 1000
· Gas cylinder: Rs 1500
· health insurance : 1000

Other expenses (40%):

· Retirement savings: Rs 3000
· Child education saving: Rs 3000
· Long term  savings: Rs 1500
· Save for yourself: Rs 500

Total expenses :Rs 20,000

Is the 60% gain Right for You?

The 60% gain  is great for those who want to prioritize non essential expenses that they care about. It’s also good for budgetary who want guidance on where their money should be going but don’t want to be too strict about tracking every rupee .

Bonus Budgeting Hack: The Cash Envelope system

The cash envelope system isn’t simply a budgeting method; it’s a route to carry out a budgeting method. Still, it’s worth mentioning.

If you’ve ever struggled with sticking to a spending limit when you’re home care shopping, updating your wardrobe or buying gifts for loved ones, then it could be time to transition to cash.

How to Use the Cash Envelope System

You commit to paying for variable expenses — such as home care, clothing, entertainment and dining out — with cash.

First, you’ll need to determine how much you can spend in each category. Using a zero-saving budget makes this part seamless because you already know your spending limits in all budget categories.
Next, you’ll tag envelopes with separated spending categories and fill them up with their allotted amount of cash.

One envelope might contain Rs 2000 for food and another might have Rs 1000 for entertainment. When you’re out food shopping, you’d spend money from your food envelope. If you are planning a go-to for movies further, you have to pay the tickets price using cash from the entertainment envelope.

If you once consumed all the cash in a given envelope, you can’t spend in that category again until it’s time to refill your envelopes with cash.

It’s essential to note that you can’t make use of cash envelopes when it comes to fixed expenses. Even bills that change time to time  — like your consumption bills — should be exempt. You can automate those bills via online banking or pay them as you normally would.
In addition, your savings allotment should go into the appropriate accounts — not cash envelopes.

Is the Cash Envelope System Right for You?

This system is for those who find themselves swiping their debit or credit cards past their budgeted spending limits. By limiting yourself to a finite amount of cash, it’s (almost) impossible to overspend.

Choosing the Best Budgeting Method

Now that you’ve been given an overview of several best budgeting methods, you can select which one is better for your financial life.

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Deepanshu sharma

HI friends I am Deepanshu Sharma is the person behind COMINGBLOG.COM I share with you some extra personal finance tips and helping you become financially independent,

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