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I’m going to be real here… budgeting is a challenge. Amongst other things, budgeting takes a good amount of self-discipline and self-awareness. Yet, you can learn to be a successful budgeter if you’re diligent and committed.

This is a quick five-step guide if you don’t know how or where to start. In the simplest terms, budgeting is managing your money to make your life work for you. Let’s organize your life by budgeting effectively so you can get out into the world and experience more!

#1. Prepare

Prepare to budget by following the five easy steps I outlined in this blog post.

#2. Categorize

This budgeting style will help organize your money into three main categories: necessities, savings, and personal funds. If you followed the five easy steps in the previous post, pull out that handy list and sort those expenses into these three categories.

• Necessities: rent, utilities, groceries, cell phone bill, transportation, credit card payments, etc.
• Savings: personal savings, vacation savings, IRAs, 401Ks, etc.
• Personal: meals out, gym membership, pet care, subscriptions, hair, nails, etc.

Note that personal items and necessities differ from person to person. Make sure you categorize according to your needs and lifestyle when budgeting!

#3. Total

Total the amount of all expenses for each of the three categories. Let’s call these your “actual numbers.”

#4. Breakdown (50-20-30)

Now, breakdown your monthly income amount into the following percentages: 50%, 20%, and 30%. Necessities will account for 50% of your budget, savings will be 20%, and personal funds will be the remaining 30%. Let’s call these your “goal numbers.”

#5. Compare

Take some time to compare your actual and goal numbers. How do they align? Is one category insanely higher/ lower than another? Compare the numbers and consciously reflect.

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Don’t worry if your actual and goal numbers are completely misaligned. This is just a start! That being said, the 50-20-30 Breakdown may not work for you at this moment, but you should ultimately strive to have your monthly expenses fit into these three percentage categories. Check in next week for more about budgeting tips and tricks to make the 50-20-30 Breakdown work for you. If you have any questions, please get in touch via email: taytraveleat@gmail.com