A Simple Budgeting Tip

piggy-bank_300Don’t know where to start when creating a budget? Alexa von Tobel, Founder/CEO of LearnVest.com and author of Financially Fearless, suggests using a 50/20/30 ratio when looking at your take-home pay.

When thinking of your finances, von Tobel says that 50 percent of your earnings should go to essentials (rent/mortgage, groceries, bills, etc.), 20 percent goes to your future (like paying off debt or saving for retirement), and 30 percent can be spent on your lifestyle—a.k.a., the “fun stuff.”

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  1. Susie

    Ummm just my rent is 50%. Not including groceries, utilities, or bills. Come up with a better ratio!

    January 24, 2014 at 2:34 pm
    • Erin

      I agree. These ratios are unrealistic!

      January 24, 2014 at 2:38 pm
  2. Cmf8375

    10-10-80 makes way more sense.

    January 24, 2014 at 2:51 pm
  3. Vernster

    Not realistic.

    January 24, 2014 at 2:55 pm
  4. Heidi

    I just checked my ratio and ours is 50/20/30 (bills/spending/saving) and we only make the average amount for our zip code. I think it is realistic!

    January 24, 2014 at 3:52 pm
  5. Sherrie Boettcher

    20 percent is needed for tithing so numbers would need to be different if this is included.

    January 24, 2014 at 6:15 pm
  6. Rose

    God only asks for ten percent, Sherrie.

    January 24, 2014 at 7:06 pm
  7. priya nair

    Susie then u need to start renting a place that you can afford . I am a Financial Planner and i live by this ratio.

    February 2, 2014 at 1:00 pm
  8. Henry

    We tithe 10% before taxes, save 30% before taxes and spend the rest after taxes.

    February 5, 2014 at 10:55 am
  9. Sherrie Boettcher

    Rose you are so right I don’t know what would make me think 20- blond moment lol

    February 28, 2014 at 11:28 pm
  10. Van for rent in manila to tagaytay

    Very good article. I will be dealing with some of these issues
    as well..

    March 19, 2014 at 3:23 pm

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