By Darla Youngblood
One way of setting a budget is to organize your after tax income into 3 areas. 50 percent to needs, 30 percent to wants and 20 percent to savings and debt repayments.
50 percent needs
This category includes essential expenses like housing, utilities, groceries, transportation and insurance.
30 percent on wants
Wants encompass discretionary spending, such as entertainment, dining out, and hobbies.
20 percent savings and debts
This portion is dedicated to building an emergency fund, saving for future goals and paying down debt.
Using this rule gives you more balance in your life to include entertainment while being responsible paying monthly bills and saving , paying down debt. It’s a good rule to follow.