Do you know about the 50-40-10 budget rule.
According to this rule,
50% of your income should be spent for your needs like
a) Household needs
b) Food
c) Transportation
d) Medical
e) Debt
f) Education
You should not spend more than 50% of your income for your needs.
40% of your income should be invested for your future goals like
a) Child Education
b) Retirement Planning
c) Asset Building
d) Child Marriage
10% of your income can be put for other discretionary expenses like
a) Restaurants
b) Hotels
c) Clubbing
d) Hobbies
e) Entertainment
It’s true that the 50/40/10 rule budget is not the easiest one for many people, especially if you are living paycheck-to-paycheck. If you cannot live with the money you earn, you definitely won’t be able to save 40% of it. You may start with small percentages of saving and increase them every month
The 50/40/10 rule budget is excellent for you if you:
- Have financial goals that need a large amount of money to be achievable, like paying debt or purchasing a house.
- Want to save most of your salary to invest in something else.
- Want to create an emergency fund to ensure you can live months without income.
- Desire to achieve FIRE – Financial Independence Retire Early.
- Don’t live paycheck-to-paycheck and can pay for basic needs with half of your salary.
If you want to achieve big goals like paying debt or purchasing a house or others, and want to plan for it, do connect with us at 9460825477
