60% budget?

[wikiwiki]

Anyone use the Microsoft Money recommended 60% budget? (only spend 60% of income)

It says it's for those that don't want to track every little thing but make it more of a general grouping (ie fun, essential, short term, retirement, etc)

Thoughts?

[disneysteve]

Anyone use the Microsoft Money recommended 60% budget? (only spend 60% of income)

I've never heard of it. How do they break it down? Is that 60% of gross or net?

Really, when you think about it, it probably is about the same as other recommendations. If 15% goes to retirement, 5% goes to other savings, and 25% goes to taxes, that leaves 55% for everything else.

[wikiwiki]

From MS Money-

Committed Expenses 60%
Basic food and clothing needs.
Essential household expenses.
Insurance premiums.
Charitable contributions.
All of our bills -- even such non-essentials as our satellite TV service.
ALL of our taxes.

Fun 10%
Fun money: which we can spend on anything we like during the month, so long as the total doesn't exceed 10% of my income.

Irregular Expenses 10%
Short-term savings for irregular expenses- vacations, repairs, new appliances, holiday gifts and other irregular but more or less predictable expenses.

Savings & Debt 10%

Retirement 10$

[disneysteve]

Short-term savings for irregular expenses- vacations, repairs, new appliances, holiday gifts and other irregular but more or less predictable expenses.

Savings & Debt 10%

Retirement 10$

I think 10% isn't enough for retirement savings, but that other 10% under "Savings & Debt" could also be retirement money since the "short-term" savings covers all the other stuff so that would be okay. Like I said, it probably works out about the same as the advice we typically give, just spun a different way.

[feh]

I think 10% isn't enough for retirement savings...

I agree. At least 15% (and ideally more) of gross should go toward retirement.

[dawnwes]

That looks like you are spending 80%. 60% for committed expenses and 20% for other expenses.

I don't see this as any different than most budget suggestions. It is just a matter of semantics.

I agree that retirement is not enough, however, when we figure our budget percentages, we do it after retirement and taxes are already taken out of the equation.

Dawn

From MS Money-

Committed Expenses 60%
Basic food and clothing needs.
Essential household expenses.
Insurance premiums.
Charitable contributions.
All of our bills -- even such non-essentials as our satellite TV service.
ALL of our taxes.

Fun 10%
Fun money: which we can spend on anything we like during the month, so long as the total doesn't exceed 10% of my income.

Irregular Expenses 10%
Short-term savings for irregular expenses- vacations, repairs, new appliances, holiday gifts and other irregular but more or less predictable expenses.

Savings & Debt 10%

Retirement 10$

[HousingCounselor]

I've tried the 60% budget. I felt it left me with too much money for recreational expenses and my household bills are pretty low. Until I am up to speed on investing, I've been parking the money in savings so I don't do something stupid with it. I was considering investing in an index fund with Vanguard. It's a funny thing that happens when you pay off debt. You literally find yourself with more money than you know what to do with.

[debtupset]

If your expenses can be 60% that's great. Most people I know who are in debt, have expenses close to 80-90% of their income. We were at about 80% and are now down to about 55%.