A roadmap for short- and long-term financial health
You’ve probably heard by now that making and sticking to a budget is one of the most important ways to ensure that your financial health remains in good standing. Maybe you’ve even calculated your budget by understanding how much you spend on your needs vs. wants, and how much you want to save for the future. Great! You’re definitely on the right track. A recent Gallup poll indicates that only 32 percent of Americans actually keep a household budget. But how do you know that your calculations are setting you up for short- and long-term financial success? A new budgeting method, coined the “50/20/30 rule,” has been gaining momentum in recent years and provides a roadmap for organizing your budget so that you spend and save ideal amounts of your income. The basic rule is to divide after-tax income, spending 50 percent on needs, directing 20 percent to savings and spending 30 percent on wants. It’s easy to set up your budget using the rule by following these simple steps:
The 50/20/30 rule is an easy and flexible way to help you budget your money. With a little bit of patience and persistence, you will soon see the benefits of understanding you after-tax income and analyzing your spending in order to save money and secure short- and long-term financial health.
The articles in this blog are for informational purposes only and not intended to provide specific advice or recommendations. When making decisions about your financial situation, consult a financial professional for advice. Articles are not regularly updated, and information may become outdated.