Budgeting 1.0.

by Nikita Vorobyov

💡 This is a quick guide on how you can make your budgeting work and make sure you are going to be a financially stable individual. Following this plan can help you not only stop losing money, but saving and multiplying.

50/20/30 Rule

Each month, split your budget into three sections.

50% for your needs
30% for your wants
20% for your savings and debt

Financial Needs

Your needs are:

Utilities
Housing
Transportation
Food, water and clothes

Keep your needs at 50% of your total income

Financial Wants

Your wants are:

Clothing that isn’t essential
Dining out or ordering take out
Hobbies, travelling, large house, and new expensive car

Just because you want it doesn’t mean you need it.

Budget your wants within 30% of your monthly net income

Debt

Paying off your debt should be a priority.

Do so in the following order:

High interest credit cards
High interest or unsecured loans
All other monthly liabilities, such as student debt, mortgage and etc. ]\

Put 10% of your monthly net income towards your debt

Savings and Investments

Investing money into your something that can benefit you in the long.

10% of your net income towards investing in these areas:

2% on your savings account chose the ones with the highest AER% one of the highest in the UK right now is Chase with 2.7%
4% into individual stocks
4% into crypto and emerging assets that are having the highest risk