Money Management Tip:

Part 3 of 3 on Proportional Budgeting 
(Part 1 - May 29, Part 2 – July 20):

If you find yourself overspending in one of the three categories consistently, there are a few options to consider:

1)    Find cheaper options for regular expenses – this could be switching from a brand name to generic or changing cell phone carriers to reduce costs
2)    Sacrifice something from a different category – perhaps meal prepping for the work week instead of dining out, which becomes easier to do when you know that you can go on a better vacation later that year
3)    Increase your income –  it may come down to not being able to compromise on your spending, then your only option may be to find ways to make more money to maintain the budget

Hopefully after a few months, the 50/30/20 budget will feel natural – by identifying purchases that are in line and those that are not. With this understanding, you should have more control of your spending and hopefully get closer to your savings goals. 

The 50/30/20 budget is a good place to start but adjusting the percentages to align with your financial goals is totally acceptable! For example, a 30/10/60 budget really focuses on paying off debt quickly with wants being sacrificed. For anyone living in big metropolitan cities, a 60/20/20 budget may be more appropriate due to higher housing costs. 

Understand that unexpected expenses can throw off your budgeting and may make some months harder to budget than others. Stay focused on tracking consistently and aiming for that balance, whether it is 50/30/20 or 30/10/60. 

Proportional budgeting is one system, and over time, you may find yourself changing to another system, but the awareness of what your priorities are will likely lead to smart spending aligned with those priorities.