Budgeting — Where Does Your Money Go?

A budget is a spending plan. Without one, money disappears and you don't know where.

The 50/30/20 Rule (Elizabeth Warren):

50% — Needs: Rent/mortgage, utilities, groceries, insurance, minimum debt payments, transportation to work

30% — Wants: Dining out, entertainment, subscriptions, vacations, shopping

20% — Savings & debt payoff: Emergency fund, retirement, extra debt payments, investments

Zero-based budgeting: Assign every dollar a job. Income − expenses = $0. Every dollar is allocated intentionally.

Building your budget:

1. Track all income (take-home pay after taxes)

2. List all fixed expenses (rent, car payment)

3. Estimate variable expenses (food, gas, entertainment)

4. Assign remaining money to savings and goals

Budget tools: YNAB (You Need A Budget), Mint, Every Dollar, or a simple spreadsheet. The best budget is one you actually use.

Common budget killers: Subscriptions you forgot about, daily coffee/lunch purchases, impulse Amazon orders. Track for 30 days — the truth is often surprising.

Reference:

Wikipedia: Budget

https://en.wikipedia.org/wiki/Budget