Monday, January 17, 2011

Comparing Budget Percentage and Guideline Recomendations

I thought today, I might take some time and help define, the recommended budget percentages. These personal budget category percentages will help you get your budget into line and on track.

One of the hardest things to do when you're creating a household budget, is to try and see where your money is going. The first thing you need to do is track your spending and see where you are overspending.

The chart below shows what some budget category percentages should be, based on four different sources. Each source has a slightly different range and your budget will change based on your income and spending needs.
Category
Typical Credit Counseling Advice
Consumer Credit Counseling Services
Charitable Giving 10-15% 4% -NA- 10-15%
Housing 25-35% 24% 20-30% 30-40%
Utilities 5-10% included in Housing 4-7% included in Housing
Food 5-15% 14% 15-20% 5-15%
Transportation 10-15% 17% 6-20% 10-15%
Medical 5-10% 6% 2-8% 5-10%
Clothing 2-7% 6% 2-4% 2-7%
Invest/Savings 5-10% 13% 5-10% 5-10%
Debt Payments 5-10% 13% 15-20% 5-10%
Misc. (Personal,Recreation,Life Ins.) 5-10% 5% 5-10% 5-10%

For example, a person with a lower income will have a higher percentage on basic needs than a person with more income, who may put more money into savings, recreation, or charity. Or, if you live in a more expensive area, you’ll spend more on housing, etc. Remember, these are only guidelines, you situation may call for numbers outside these percentages.

If you haven't already done so, you may want to check out my free downloadable budget form. Available at PrinceOfThrift.com.
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go ahead share your thoughts with me now, my ears are open. I'm always eager to hear what you think.
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