If you’ve been trying to find a saving and budgeting method that works for you, give the 50/30/20 plan a try. This is a common budgeting strategy that is designed to split up your income in three different ways, putting the perfect amount towards your needs, wants, and savings.
The 50 percent
Half of your take-home pay should go exclusively towards all necessities. This includes bills, rent or mortgage payments, utilities, transportation, healthcare, food, and so on.
The 30 percent
You should aim to only use 30 percent of your income towards fun and leisurely purchases, such as entertainment, vacations, shopping sprees, etc. There can be a fine line between what is categorized as a want or a need; your cable bill, for instance, should be part of the 30 percent group. While your phone bill might remain in the 50 percent group, any charges for unnecessary add-ons (such as unlimited Internet use) should separately be filed under the 30 percent.
The 20 percent
The remaining 20 percent of your income should go into savings. You should avoid using this money unless you’re paying off debt, using it for a large financial goal, or if a true emergency arises. Unless it’s a financial emergency, such as a job loss, you should also avoid completely depleting your savings; it’s recommended to have money for three to six months’ worth of expenses saved at all times.
Are you the recipient of a long-term payment stream, such as a structured settlement or annuity, but you need cash now? At Peachtree Financial Solutions, we realize that sometimes the initial set-up of a long-term payment stream can prove to be inconvenient eventually. When unexpected life situations occur, the periodic payments might no longer be a realistic financial solution. To allow you to cash your money sooner, rather than later, Peachtree Financial Solutions can purchase your future payments and offer you your money in the form of a lump sum. We also offer our customers a variety of settlement funding transaction options to choose from, including the choice to sell just a portion of future payments or to sell all of them. Contact us today to find out more and to receive your free quote!
Nothing above is meant to provide financial or tax advice. You should meet with appropriate professionals for such services.