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My Super Simple Budget

When I first moved out of my parents house, I searched the Internet for a starting point on how to budget. Why don’t they teach you these things in school? During my years in university, working part-time, living in a small inner city apartment with my now husband, this is the budget I started with and tweaked along the way, and what I’ve reverted back to now, as a stay at home mom.

Before I get started, I want to lay down some facts about my particular situation, as I know this budget is not feasible for everyone.

Jeremy was working a full-time, well paying job. He ‘could’ handle our bills if absolutely necessary. However, at this time in our lives, we were splitting our bills 50/50 as much as possible.

Now, I am a stay at home mom to our two children. We are home owners. Jeremy is now covering most of our shared monthly expenses himself (I pay for my own phone and car etc.).

The Simple Budget
Needs (Bills) – 50%
Wants – 30%
Savings (Debt Repayment) – 20%

This is OVERsimplified, and is just a place to start. The percentages are based off your take-home pay cheque. Let’s break it down a little further:

Needs – For me, my needs are all my bills and necessities. This includes cell phone, car payment, insurance, groceries, rent/mortgage, Internet etc. What do you need to “survive”? In my experience, to live comfortably (not pay cheque to pay cheque), your needs should only take up 50% of your income. Again, I was sharing these expenses with my partner. If I were living on my own, my bills most definitely would have taken more than 50% of my pay.

Wants – What things are nice to have or do, but not actually necessary to “survive”? This includes eating out with friends, experiences, makeup, books, your morning coffee, Netflix, etc. When I was in university, I would calculate this, and take it out in cash. This insured that I could not go over budget. If I didn’t have the cash, I couldn’t grab that coffee on my way to class, or that lipstick that was on sale super cheap. If in two weeks, when my next pay came, I had any left, I’d put it away for a bigger expense down the road. This looks a little different for me today, I set this aside for my kid’s birthday gifts, home decor, upgrades for my business, etc.

Savings (Debt Repayment) – I put this in one category because I believe it’s a personal choice on how much you allocate to each. Some feel putting it all towards debt repayment is best, others do a combination, or put it all towards savings until they have a safety net. While I was in university, I put 5% in savings, 10% on my credit card, (the 10% of your pay check is above your monthly payment), and 5% on my student line of credit. Today, I’m putting the full 20% towards debt repayment.

I hope, if you are looking for a place to start, this was helpful. Again, this worked for me as a student, and now with the extra income I’m bringing in on the side while I stay at home with my kids. I do have a finance degree and would love to share more money related content on this blog. Leave me your feedback in the comments!

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