Personal Finance & Money Asked by Corey P on December 11, 2020
I’ve always used the envelope method to budget. I know Mint uses a different method, but I’m not sure if it has a name or not. It could simply be a derivative of the envelope method. Wells Fargo’s built in budgeting tool seems to do the envelope method in reverse, where you spend until you reach the upper limit. Again, does this have a name?
What are the most common budget methods? What are their pros and cons?
I write down each payment method and create a list in order by due date under each payment method. Then as each date arrives I pay the bill that's due and write it down with the following months list
Answered by TechAnt on December 11, 2020
There are four common types of budgeting methods :
Basically you take previous month's numbers (assuming your track your spending to the penny) and you add or subtract a percentage to obtain the next month's budget.
For example, in the 80/20 budget, you spend 80% of your income, and save 20%. In the 50/30/20 budget, you spend 50% on necessary items (needs), 30% on discretionary expenses (wants), and put 20% toward debt and savings.
Paying yourself first puts the focus on your savings. That’s because you put money away at the beginning of the month, before you have a chance to spend it on anything.
This is exactly what it sounds like. At the end of the month, your budget should equal zero. That means that if you have $300 left at the end of the month, you need to give that $300 a job. Every dollar needs to be accounted for.
Read more and source : https://www.youngadultmoney.com/6-different-ways-to-budget-your-money/
Personally I suggest you mix Proportional Budget, The Envelope Budget and Zero-Sum Budget. This will gives you a pretty good general idea about where your is going (Proportional Budget), also you organize the portions into sections so your money is well spent (The Envelope Budget) and you know exactly where every cent will go (Zero-Sum Budget).
Answered by Fourat on December 11, 2020
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