Have you heard about the 50-30-20 Rule? It’s a simple practice, that could help to kick-start your savings. The rule breaks your monthly income into manageable amounts.
Here's how it works:
We said it was simple and it is. By breaking your monthly income into three different segments – Must Haves, Wants and Savings – you may start to think more about prioritising your outgoings and could start to see your savings grow.
How to work out what you're spendingOne way to work out where you’re spending your money is to keep a record of where it’s going. Collect all your receipts for at least a week and keep track of them using an app like the MoneySmart TrackMySPEND. You’ll be more conscious of what you're buying and you'll see exactly where your money goes.
Once you have a record of everything you buy, put the different types of purchases into categories so you can see where you spend the most. For example, household expenses like electricity and gas will go in one column, while groceries will be in another. MoneySmart’s budget planner calculator is a great tool to help you categorise your expenses.
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