How to budget your monthly income and save more

How to budget your monthly income and save more

The desire for financial security and to live a happy, debt free life has led to people coming up with methods on how others can achieve that goal

All these methods aim to help you know what  to prioritize in your spending and savings. Some of them were successful to certain groups of people while some of them were not, including the 50/30/20 rule.

I find the 50/30/20 rule which simply means 50% of your monthly income goes to your needs, 30% to your wants and 20% to your savings, to not work all the time.

People tend to find other sources of income not to increase their needs and wants, rather to be able to afford their lives and save more for their future. But with the rule, the more you earn the more you spend.

In order to become successful and in control of your finances you need to have financial discipline and have necessary savings and limit your wants. Adding more to your savings will pay off later than the frequent travelling and movies. Eating is a need but eating out frequently cuts down on your savings more than eating a home cooked meal.

This article provides you with another alternative budgeting method if you do not have any that works for you.

Before starting your budgeting, you need to first take out a tithe which is 10% of your income as a way of honouring God’s word before you start assigning responsibilities to the remaining amount.

From what you are left with, define your fixed expenses, mainly your needs and define your wants. Sometimes your spending will not be fixed, sometimes you will have to cut off certain expenses in order to pay another important bill.

Your fixed expenses are your Groceries, Housing/Rent, Transportation, Utilities and health insurance for those who pay it themselves after getting their salaries. Your wants are your phone bill, entertainment, travel, dinner out, gifts and your savings should include your emergency fund and future savings.


The order at which money goes out should start with your savings. Unlike other suggestions, of saving 20% and spending 30% on your wants, I will suggest that after your tithe you should put 25% into your savings 15% into your future savings and 10% into your emergency fund.

Everything that comes from someone wanting to borrow money, a contribution at work, an unexpected medical bill, all goes to your emergency fund and you never touch your future savings at all.

Your Fixed expenses

After you have set aside some money to save now you have the recurring expenses;

Housing/Rent – 20%, some will tell you to spend 25% up to 35% of your monthly salary. I say that is a lot. Try not to spend a quarter of your salary on rent/ housing expenses because as much as this is essential, there are other small things which need to be attended to as well.

Groceries – 15%, this includes your monthly food, household and toiletries. Some items will last for over a month so you can save a few cents on groceries and store it. You might need it at some point

Transportation –10%, for those with cars this includes your monthly fuel but could go up to 15% depending on your routes. Those who use public transport should not go above 10%

Utilities – 10%, this includes your electricity bill, water bill, gas and recycling money.

Your wants

20% of your salary should These are basically your luxuries, you can live without but they are also essential for your happiness. Your entertainment, gifts, your phone bills, dining out and self-treats

The best thing is to know your expenses and which you will spend more on and adjust your expenses accordingly without affecting your savings.