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Are you looking to make a budget to better control your expenses?

But do you find it too complicated to create and manage?

It is true that it may seem a bit difficult at first!

Fortunately, there is a simple and effective way to better manage your budget and control your spending.

This method, this is the famous 50/30/20 rule.

Don't worry, it's super easy to budget using this method. Look :

Click here to easily print the guide in PDF format.

Why does it work?

Be aware that the 50/30/20 rule was invented by Elizabeth Warren herself.

The former Harvard professor is now the vice president of the US Senate, and is recognized by the journal TIME as being one of the 100 most influential people in the world.

And it is thanks to this method that my husband and I have finally managed to budget and manage our money much better.

The first thing to do is to create an Excel table to list ALL your expenses.

Don't forget anything including all direct debits from your account, like your Netflix or Spotify subscription.

The more exhaustive you are, the more precise the results will be.

Now you will create your budget by dividing your monthly net income according to the 50/30/20 rule.

Which give :

- 50% for fixed expenses,

- 30% for leisure and

- 20% for savings.

STEP ONE: Calculate your monthly net income

This is simply the amount paid into your bank account each month, after deducting taxes.

If you are self-employed or do not receive a regular salary, then look at the income for the last 3 months, and calculate the average, always after deduction of taxes.

And if you have supplemental health, a retirement plan, life insurance, or some other mandatory deduction withheld from your payslip, then add those amounts to your net monthly income.

You thus obtain your monthly resources, to which you will apply the following percentages: 50/30/20.

STEP TWO: 50% for fixed expenses

What are fixed expenses? These are all irreducible expenses such as rent, charges and insurance.

Note how much you spend each month on "fixed expenses", including groceries, rent, fixed charges, your health insurance and your car insurance.

The total amount of your "fixed expenses" must not exceed the 50% of your monthly resources.

Are you making repayments on a loan? So put them in this category as well.

Why ? Because if you miss a repayment deadline, it can have a negative impact on your credit and your financial future.

STEP THREE: 30% for leisure

At first glance, 30% of your monthly leisure resources seem widely sufficient, isn't it?

You think you're going to be able to treat yourself ... let's go for a vacation in the Bahamas, brushings at the hair salon, starred restaurants, etc.

But not so fast! Because, remember, "leisure" includes all the expenses that can be taken away without really disrupting your life.

Thus, "leisure" expenses also include your unlimited portable package, your subscription to the gym or your Netflix subscription ...

And of course, leisure includes shopping for clothes too - so focus on sales, outlet stores, and clearance stores when shopping.

STEP FOUR: 20% for savings

Use at least 20% of your monthly income for your savings, to create an emergency fund of € 500, to save for your retirement or to put money into old age insurance.

The category "savings" can also include the repayment of your debts.

And don't forget that if you pay monthly installments on a loan, they fall under the "fixed expenses" category.

On the other hand, early repayments represent a repayment additional to your debt, and fall into the "savings" category.

For example: if you have a mortgage / car loan, all the monthly payments fall under the category "fixed expenses".

Results

There you go, you now know how to budget like a pro with the 50/30/20 rule :-)

Easy, fast and efficient, isn't it?

In 4 easy steps, you can now determine the ideal budget to put in place - one that matches your spending and financial goals.

Since we use this method, we know exactly how much we can spend per month for our desires and hobbies, but also how much we must save according to our wages.

Your turn...

Have you tried the 50/30/20 rule to budget? Tell us in the comments if it was effective. We can't wait to hear from you!

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Also to discover:

The Weird Trick I Use EVERY MONTH To Stop Going Over My Budget.

How to Budget LIKE A PRO In 5 Super Easy Steps.