Setting the right monthly budget

Are you struggling with setting the right monthly budget? Not to worry, we’ve got you covered!

Using the Reach app as a guide, we will be allocating all your expenses to a particular percentage to help you become equipped with a better budget and future financial plan.

Here you go:

Housing (24%)

This basically covers your rent. If 24% of your monthly income accrued at the end of the year cannot pay your rent annually, then you are most likely living above your means.

Transport (10%)

Whether you go to work on a commercial bus or in your personal ride, your expenses for your fare or fuel should not exceed 10% of what you earn monthly.

Grocery (12%)

Your groceries are basically your food items. Your rice, garri, water, beans, and so on, fall under this category. You cannot do without them, so it’s important you set a budget for them and stick by it. How does 12% sound?

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Savings and investments (15%)

This is very important. 15% per month seems fair to withdraw and set aside, as you don’t have to go broke and hungry, trying to reach your financial goal.

Restaurants (3%)

Considering you already have 12% allocated to your groceries, this should be fair. Really, this plan might dissuade you from eating out often, but it will help you save some change.

Health and wellness (5%)

Hopefully, you don’t fall sick often. But it is reasonable to build emergency funds to take care of illnesses. Saving 5% of your income every month should be able to take care of things.

Entertainment (2%)

What a killjoy, right? But think about the future. Besides, when you finally hit your financial target, you will be able to have as much fun as you want, with no restrictions.

Personal care (3%)

This entails your toiletries, soap, cream, deodorant and the like.

Clothing (3%)

What are our shopaholics going to do? They will manage, that’s what. If all you need to buy exceeds 3% of your monthly income, then you will have to carry the excess figure over to the next month.

Bills and utilities (5%)

These involve electricity bills, service charges, cable bills and so on.

Faith and charity (18%)

Here, you can also save up to take care of the needy, help friends who need money from you, pay offerings and tithes at the place of worship and so on.

If you calculate all that is listed above, you will see that it all amounts to a hundred percent of your monthly income. You will be able to effectively manage what you measure.

Reach is an online application – or online money manager – that tracks your expenses and spending.

Have you set your financial goals? What do you think about this budget? Can it work for you? Let us know.