The 50-30-20 principle of financial planning
Having an organized flow of expenses is essential when you have a steady income.
The cost of essentials is rapidly increasing in the world today.
What can you do to make sure you have surplus cash left over to spend on wants and save?
Kaustabh Belapurkar joined us to answer this question.
He suggested the 50-30-20 rule of financial planning as a key rule to consider for budgeting expenses.
As per rule, one must spend 50% of their earnings on necessities or requirements.
– Home Rent
– Children School Fees
– Insurance Premiums or EMI Payment
For desires, you must set aside 30% of your earnings.
– Going to Restaurants with Family
– Going For Trip with Family
– Want to Buy New Phone
– Want to buy New Car
And finally, you have to Invest 20% of your earnings.
1. Buy Property
2. Invest in Stock Market
3. Mutual Funds
4. Insurance Plans
You'll find it simple to make and commit to a monthly budget if you follow this rule.