Making Your Budget Less Spooky: A Guide to Simplify Your Budget

Introduction:

For many individuals, the realm of budgeting can seem daunting and filled with uncertainties. However, with the right strategies and knowledge, managing finances can become less intimidating. In this article, we will explore the principles of making budgeting less formidable, emphasizing the significance of paying yourself first and offering guidelines on spending habits.

I. Paying Yourself First – The Golden Rule:

Definition: Paying yourself first entails allocating a portion of your income towards savings and investments before addressing other expenses.

Importance In Three Parts: Financial Security, Retirement Planning, How Much to Save

• Financial Security: Adopting this practice is a great way to force savings to help with accumulating wealth over time.
• Retirement Planning: Consistency in paying yourself contributes to building retirement funds over decades of work.
• How Much to Save: A general guideline is to aim to allocate at least 20% of your income towards savings and investments.· Paying yourself first is a great way to force savings towards your goals – making sure you are looking out for your financial future.

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II. Expense Guidelines – Navigating the Financial Landscape:

• Housing: Strive to spend less than 30% of your gross income on housing to maintain a balanced budget and prevent financial strain.
• Transportation: Aim to allocate no more than 10% of your take home pay towards transportation costs, considering car payments, insurance, fuel, and maintenance.
• Debt Repayment: Try to allocate a maximum of 10% of your income towards paying off debts, giving priority to high-interest debts.· These are guidelines to aim for – life happens with student debt, cars breaking down, and higher living expenses. Aiming for these is are great guardrail to keep you on track.

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III. Adjusting the Sails – Personalizing Your Budget:

While the guidelines provided offer a foundational roadmap, it is crucial to tailor your budget to accommodate your unique needs and goals. Evaluate your individual financial situation, adjust allocations, and prioritize spending in alignment with your values and objectives.

·?If you have any questions at all, please feel to reach out – we are more than happy to review all aspects of your financial situation and build a plan that works best for you.

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IV. Monitoring and Reviewing – Staying on Course:

It is essential to regularly monitor and review your budget to ensure it aligns with your financial goals. Adapt your budget in response to changes in income, expenses, and financial priorities to maintain control and make informed financial decisions.

Conclusion:

Stepping into the financial journey doesn’t have to be overwhelming. By embracing the principle of paying yourself first and sticking to expense guidelines, you can simplify the budgeting process and pave the way for a prosperous financial future.

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Steven Evensen is a Financial Advisor of Santa Monica, Calif-based Gerber Kawasaki Inc., an SEC-registered investment firm with approximately ~$2.2B billion in assets under management as of 02/16/23. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which course of action may be appropriate for you, consult your financial advisor. No strategy assures success or protects against loss. Readers shouldn't buy any investment without doing their research to determine if the investments are suitable for their situation. “All investments involve risk and one should consult a financial advisor before making any investments. Past performance is not indicative of future results."?