Talking about money can be a bit of a drag, right? But it’s super important, especially for us busy moms and women who have a lot on our plates. Today, I want to share a budgeting method with you that’s really easy to follow and actually makes sense for our hectic lives. It’s called the 30-30-30-10 budget. I’m excited to break it down for you and show you how it can fit into your life. Let’s get into it!
What is the 30-30-30-10 Budget?
In simple terms, this budget rule divides your income into four parts:
- 30% for Housing
- 30% for Living Expenses
- 30% for Savings and Debt
- 10% for Personal Spending
Let’s break these down, shall we?
30% for Housing
This part covers your rent or mortgage, including property taxes and homeowner’s insurance if you own your home. Keeping housing costs at or below 30% of your income helps ensure you’re not house-poor, leaving room in your budget for other important things.
- Mortgage or rent payments
- Home or renters insurance
- Property taxes
- Home repairs and maintenance
- Utilities (electricity, gas, water)
- Internet and cable services
- Garbage and recycling services
- Home security systems
- Lawn care and gardening
- Homeowners association fees
- Pest control services
- Furnishing and home decor
- Appliance purchases or repairs
- Cleaning supplies
- Pool maintenance
- Snow removal
- Heating and cooling system maintenance
- Sewer and septic services
- Water softener systems
- Emergency home fund (for unexpected repairs)
- Mortgage insurance
- Property management fees (for rental properties)
- Home improvement projects
- Window cleaning services
- Roof maintenance and repairs
30% for Living Expenses
This chunk is for all your daily living costs – groceries, utilities, car payments, gas, and the never-ending list of kids’ needs. Sticking to 30% here can be a bit of a balancing act, but it’s doable with some smart shopping and prioritizing.
- Groceries and food
- Car payments
- Fuel for vehicles
- Public transportation costs
- Health insurance premiums
- Out-of-pocket medical expenses
- Prescription medications
- Childcare or babysitting
- School supplies and fees
- Pet food and veterinary care
- Clothing and footwear
- Laundry and dry cleaning
- Haircuts and personal grooming
- Gym memberships or fitness classes
- Cell phone bills
- Regular dining out or takeaways
- Entertainment (movies, events)
- Kids’ extracurricular activities
- Educational courses or training
- Books and magazines
- Home cleaning services
- Basic household supplies
- Gifts for birthdays and holidays
- Donations or charitable giving
- Insurance (auto, life)
30% for Savings and Debt
Here’s where you tackle those future goals and past debts. Whether it’s saving for a vacation, building an emergency fund, or paying off credit cards, this 30% is your ticket to financial peace of mind. It might mean cutting back on some luxuries, but hey, peace of mind is worth it.
- Emergency fund contributions
- Retirement savings (IRA, 401k)
- College savings for children
- Credit card payments
- Personal loan repayments
- Mortgage extra payments
- Car loan repayments
- Student loan payments
- Savings for a vacation
- Investment contributions (stocks, bonds)
- Down payment savings for home or car
- Business startup savings
- High-interest savings accounts
- Health Savings Account (HSA) contributions
- Debt consolidation payments
- Home renovation savings
- Wedding savings fund
- Saving for a major purchase (furniture, electronics)
- Saving for special occasions (anniversaries, milestones)
- Rainy day fund
- Savings bonds or certificates of deposit
- Life insurance premiums
- Disability insurance
- Building a fund for a new business venture
- Contributing to a flexible spending account (FSA)
10% for Personal Spending
Last but not least, this is your fun money! It’s completely yours to spend on whatever makes you happy – a new book, a night out, or that cute dress you’ve been eyeing. It’s a small portion, but it’s important to have a little something for yourself.
- Eating out at favorite restaurants
- Movie or theater tickets
- Coffee shop visits
- Shopping for non-essentials (clothes, gadgets)
- Hobbies and craft supplies
- Books and e-books
- Streaming service subscriptions
- Spa and beauty treatments
- Weekend getaways
- Concerts or sporting events
- Video games or apps
- Home entertainment (movies, music)
- Gym or fitness class upgrades
- Personal development courses
- Gardening supplies
- Art and museum visits
- Photography gear or classes
- Cooking classes or culinary experiences
- Retreats
- Makeup and personal care products
- Fashion accessories (jewelry, bags)
- Subscription boxes (beauty, food)
- Outdoor gear (camping, hiking)
- Tech gadgets and accessories
- Wine or gourmet food tastings
Steps to Implement the 30-30-30-10 Budget
Step 1: Determine Your Monthly Net Income
- Calculate your total monthly take-home pay. This is your income after taxes and other deductions.
Step 2: Calculate Your Budget Categories
- Housing: Multiply your monthly income by 0.30.
- Living Expenses: Multiply your monthly income by 0.30.
- Savings and Debt: Multiply your monthly income by 0.30.
- Personal Spending: Multiply your monthly income by 0.10.
Step 3: Assign Actual Expenses to Categories
- List your monthly expenses under each category.
- Adjust within categories to ensure each expense fits into its allocated percentage.
Step 4: Monitor and Adjust
- Track your spending throughout the month.
- Adjust allocations if necessary while keeping the total within the set percentages.
Step 5: Regular Review and Adjustment
- Review your budget monthly.
- Adjust the allocations as your financial situation changes.
By following these steps, you can effectively calculate and implement the 30-30-30-10 budget. Remember, the key is to stay flexible and adjust as your financial needs and circumstances evolve.
Why It Works for Moms
- Simple to Understand: No fancy finance degree needed here. It’s straightforward, and once you get the hang of it, it feels like second nature.
- Flexible: Got a big car repair one month? You can adjust as needed. It’s real-life friendly.
- Balanced: It covers all the bases – home, daily life, future plans, and a little fun. It’s like the mom of budgeting methods – always making sure everyone is taken care of.
Tips to Make It Work
- Track Your Spending: You can’t manage what you don’t measure. Use a simple app or even a good old notebook to keep an eye on where your money goes.
- Be Realistic: If you’re spending 50% on housing, consider if downsizing or moving is possible. If not, adjust other categories slightly.
- Involve the Family: Teach your kids about budgeting. Have them help with grocery lists or understanding why saving is important. It’s a team effort!
- Review and Adjust: Life changes, and so should your budget. Check in every few months to see if you need to tweak anything.
Managing money doesn’t have to be a daunting task. The 30-30-30-10 budget is a practical, manageable way to keep your finances in check while still enjoying life. Remember, it’s about finding a balance that works for you and your family. So give it a try, adjust as needed, and watch your financial health improv
