3 Easy Budgeting Methods for Busy Families

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In the ideal world, we can all just spend to our heart's desires and all your bills would magically disappear. Kind of like the type of world where you can just eat and eat and never get fat. But we all know the quick way to land yourself in hot water financially is to keep spending blindly and hope for the best. It is also a surefire way to land yourself in debt. I have been reading about budgeting a lot this year, as the economy on our side of the world has not been the greatest. I have also tested a few methods out to see what works for me. Let's go.

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1. The 50/30/20 method

This sounds way more complicated than what it is. If you want to read an in-depth post on how this works, you can read all about it here. I found this article incredibly helpful and explains the concept in a nice and easy to understand way. What exactly this entails is you take your income and divide it into 50 - 30 - 20. This is also called the percentage based budget. You divide your income between Needs, Wants and Save. Essentially it is 50% of your income allocated to Needs, 30% to Wants and 20% to Savings.

How is this different from a traditional budget? Well, the traditional budget looks at your history and then you change your spending as you go along in order to place yourself in a better financial position. A percentage based budget looks at your history as well, but it helps you predict where your spending will go. It gives you better control over what you spend your money on. It is very easy to start with a percentage type of budget, all you need is to write down your total income and then divide it into three. the 50/30/20 ratio is the most popular and easiest to apply, but you can tweak it.

After writing down all my Needs, I realized that I need to adjust it slightly, as my needs came to 60%. So what I did was change mine to 60/20/20. It seems to be working well because I don't feel like I am being constricted too much. I could never stick to traditional budgets where x amount of money is allocated to entertainment and y amount of money for groceries. When you have kids, the spending can take unexpected turns. This method makes it feel like I am in control, not the budget if that makes sense. How did I apply this method practically? Easy.


First, I wrote down all of my expenses that are Needs, the ones I could not change. This would be housing, car payments, insurance, bank fees, groceries, schooling, utilities, internet, phones etc. The day to day things that you HAVE to pay. Mine is a little bit high, and I think when I have mastered this budgeting method, I need to relook this column. Anyway, moving along, I worked out it comes to 60% of my income. I was generous with things like the groceries, so I may end up spending less than this. The next column is called Wants.


In this column, you take 30% or in my case, 20% of your income and you write it down. That is the amount you have to spend on things you don't really need but would like to have. I like that there is a column like this, without specifying what it entails. Once again, it gives you a little bit more freedom with your money. And once you have spent all the allocated funds for Wants, you have to wait till next month for more. Simple. What would we classify as wants? Eating out, buying treats, going to movies or theatre. Personal expenses, which you may think is a need but is, in fact, optional in the bigger picture.


Then the last column is for savings. The budget states 20% and I kept it at that number. I think most of us overlook the importance of saving. I tweaked the budget slightly again in order to pay off debt quicker. What I have done is worked out how many months it should take to clear my debt if I apply this 20% towards paying it off. Once it is paid off, I will change it to savings and pay it into a notice account.

Will this work for everyone? Probably not. If you are in a very bad financial position you may have to apply all your funds to you Needs, until you can make more money. I think it is a good way to start budgeting as it is less complicated, and it is a nice way to introduce budgeting to your kids.

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2. The Cash Only Method

To be honest, I have tried this a few times. You take cash for the week and spend only that. This means the rest of your money is safe and sound in the bank. Some people go so far as to leave their card in a safe place and only carry the week's cash around. It works because you are limited. I had to break the rules a few times when unexpected expenses popped up.

That being said, I have seen lots of people be very successful with this method. If you have a habit of overspending, this method can help you reign it in. Another cash only method is called the Cash Envelope system. It is very popular on Pinterest and there are hundreds of pins about how to use the cash envelope system effectively. You are always in control of what you spend your money on. I did this for a few weeks, and I found that because you have physical cash in your hand, it is easier to show some restraint with spending. Swiping has become way too easy.

A way that works better for me for this method is to automate the payment of your bills and savings first and then you draw money either per week or per category and place it in the envelopes. For someone with self-control issues, this will probably work the best.

Bru-nO / Pixabay

3. The Zero-Based Budget

This budgeting method was created by Dave Ramsey. What this budgeting method entails is to give every dollar (or Rand or Pound or whatever currency you use) a job. This means you "spend" every dollar that you earn. Savings is also seen as "paying" that account. It is also a very popular budgeting method because every dollar has a purpose and by payday, you should start at zero. This method would work for you if you like to be in control of your money. You literally put every dollar to work and micromanage your finances. It can be quite a time-consuming exercise, because of all the planning that goes into it. If planning and tracking is your thing, you might get a kick out of this method of budgeting.

I have tried this method, and it just seems way too involved to me. Like the cash-based budget, I find these methods time-consuming. I prefer to automate things. I did it for a couple weeks and then gave up, because it was just taking up too much of my time planning the budget.

What budgeting method do you use? I know there are hundreds of more methods, but these are just the three I have personally tried and my experience with it. I think it is a good thing to try new things and tweak the different budgets to better suit your lifestyle and personality. Budgeting is becoming more and more important for busy families as the cost of living is ever increasing. If you want to read more about financial planning for families you can go to this post. 

I am learning as I go with household finances, we are a young family and starting to realise we need to make better financial choices in order to live the best life and provide a solid future for our girls.





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