Add Your Raise To Your Savings Account
I’m pretty sure most of us are already thinking about how to spend our money whenever we got a raise. However, that’s something not very wise to do. Instead of spending the money try putting it into a savings account. This can help avoid the problem of lifestyle inflation, while growing your savings significantly.
Try The 50/30/20 Rule For Budgeting
If you’re new to budgeting, try allocating 50% of your take-home pay towards necessities (food, shelter, utilities, clothing, etc.), 30% towards lifestyle choices (vacations, gym fees, hobbies, cell-phone plans, etc.), and 20% towards financial goals and priorities (extra debt payments, savings, etc.). This isn’t a perfect budget, but it can be a good place to begin. (Source: doughroller.net).
Allot 2–10% Of Your Budget For Personal Items
Anything you’d like to treat yourself to, use about 2-10% of your monthly salary. You’ll be able to save a lot of money. In case you need a bit more money, try reducing other expenses that you may consider unnecessary.
Put No More Than 30–35% Of Your Net Income Towards Minimum Debt Payments
This applies mostly if you have a mortgage. However, if you don’t have a mortgage, then you should put about 30–35% of your net income towards both minimum debt payments and your monthly rent.
Limit Your Student Loan Borrowing To Your First Year’s Expected Annual Salary
To keep your student loan borrowing with no problems, do a bit of research on typical first year salaries in your field. Keep your student loans’ total balance to this amount or, preferably, much less (If only I had known about this before).
Put At Least 20% Down When You Buy A Home
With this rule you’ll be able to limit the total amount you borrow for your new home (leading to significant savings). Also, you don’t have the added expense of private mortgage insurance.