Rich Auntieeeee!!! You back love?!
I'm definitely glad you are back! We are going to dive further into the dreaded budget! I bet you are wondering how deep can the topic of the budget really be?
REALLLLL DEEP Rich Auntie!
Let's not dilly dally, focus now darling! The first thing we need to discuss is the types of budgeting methods. There are several out there so I'm going to explain a few that actually make the most sense. We have to cover these before we can go into the rudimentary elements of the budget itself.
This is what I equate to being the simplest almost non-budget out there. Essentially you pick an arbitrary percentage that you'd like to save monthly | bi-weekly | weekly and you basically can spend the rest. Now in an ideal situation you would pick a high percentage like 70% or more and spend what's left over. THIS DON'T WORK RICH AUNTIE! We have bills and most of us have debt! So unless you are starting off with a blank slate (no debt and no bills) you bett' not be using it!
The 50/30/20 Budget
Ard! (said in my best Baltimorian voice and no I'm not from B-more I just occasionally steal their lingo and get a kick out of hearing them say "to" (TEW) and "dog" (DUG)) Anywho, the 50/30/20 budget is at it's root needs, wants and savings. 50% of your income is devoted to needs, 30% is devoted to wants and 20% goes to savings. Now this is a step above the Anti-Budget. There's a little more structure, however, it's still basic and Rich Aunties aren't basic. You may be wondering why I called it basic....well for starters only 50% is allotted to needs. What on earth do you classify as a need? Well if I don't pay my credit card bills, student loans, mortgage/rent, car note and phone bill my credit score will go down so I guess that's a need. But when I add in food, gas, and unexpected costs I've exceeded 50% of my income. Rich Auntie this budget is constricting our extraness and I sure don't like it! Let's just move right on along. Extra people need flexibility and this is just as tight as my pants I keep holding on to from 5 seasons ago.
The Happy to Be Alive Budget
Life can hit us hard and in a lot of cases can be really unfair. In a perfect world financial strains would be non-existent!! But life ain't fair Rich Auntie and some of us are in survival mode living pay check to pay check. The Happy to Be Alive Budget is doing what's necessary to make it to the next payday. Rich Aunties I've been here before and worked 2 sometimes 3 jobs to get ahead. For my Rich Aunties who are here you can make it through keep pushing. Nothing is forever unless you want it to be. Stay strong, cry your tears, and remember trouble don't last always!!
The Zero-Sum Budget
Last but not least we have the Zero-Sum Budget. Basically this budgeting method requires you to allocate every last drop of your income to a category. These categories are whatever you want them to be. This is a totally customize-able high maintenance budget. You are managing this diva to the penny!! While that can be cumbersome in our somewhat automated lives, it is often necessary when we have dreams and goals we want to achieve. This is the budgeting method we will be using moving forward so learn to love it Rich Auntie!! We demand excellence and extraness on all levels, our budget might as well fit that bill.
Whew, well that was an intense lesson on types of budgets. Issue No. 4 will go into developing a Zero-Sum Budget and will discuss manual vs automated tracking. It will even provide some templates for you to use!
This riveting series is destined to take you somewhere Rich Auntie!
Stay fabulous. Exude Excellence. Be Blessed.