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I can’t help myself. I have to know.
For folks not retired and who use a budget — does your budget determine how much you can save or do you save first and then develop your budget and allowable spending funds available after saving?
No judgement, just curiosity.
Here is food for thought.
A new WalletHub survey on American’s debt says ”65% of people think better budgeting will solve their problems with debt.”
I’m thinking better.spending habits might be the answer.
I’ve always kept our retirement savings rate as high as possible. Those deductions are gone before we get our paychecks, so I don’t miss them.
I keep a spreadsheet with all our monthly bills on it. Some, like gas & electric, are set to the average monthly amount, not the highs we see in winter and summer.
That tells me how much we need to pay all the bills in the first and last two weeks of the month. I also put money in an emergency fund and a vacation fund every month.
After that, I’m good with spending what’s left, which is more than enough to enjoy a comfortable lifestyle.
EveryDollar budgeting software is free at Ramsey Solutions. Jump on there and see how it works.
In the budget it has a line-item for savings. The savings is part of the budget (or can be). No hard and fast rules.
I think it’s all a bit subjective. If you have a generous income, putting aside savings before you budget makes sense. If your income is very tight, budgeting first to see how much you can save is probably best. Personally, I never budgeted and to this day I couldn’t give you a detailed breakdown of my spending by category.
When I was working, all budgets we developed were on net amounts after savings.
Thanks