Budgeting Rule -- 50, 30, 20

King and I always come up with this topic -- where did our money go to? Where's our budget? Yes, we always keep reminding each other about budgeting and watch our spending. Thanks to Rose for an online article sharing last week. And I would like to share some tips with my friends here.

There's no one-size-fits-all solution because everyone's circustances vary widely. However, the 50-30-20 Rule is a basic budgeting that we can apply on every single household. And I find that it's interesting and pretty good. It makes sense and I got to know that what current life style I'm falling into with my budget.

50% ~~

These 50% amount of your after-tax wages will go to our must-have fixed spending. For example, housing loan, car loan, utilities, phone bill, food, insurance, childcare, etc. These 50% is a must-have spending without compromising.

30% ~~

The 30% is calculated as a flexible figure. Clothes, vacation, extra features on phone bill (call waiting, etc), dining-out, Internet access, TV cable, etc. All these are extra services and features if you do not really need it. Hence, 30% is the margin within the monthly spending.

20% ~~

Saving will go into this 20% gap. Whichever type of saving counts. For example, cash saving, retirement fund, emergency fund, etc. When we can retired without worry and how much we can survived without a job out of the sudden, it depends on this accumulated 20% amount. So, this 20% plays an important role among the 100%.

Again, thanks to the article from MSN Money website. I truly think this is one of the best budgeting ideas that I've ever read, so far. I looked into my monthly bill and loan settlement after reading. I'm happy that my financial circumstance fits into this 50-30-20 Rule. It's time for us to move on again.

Happy budgeting!