Guideline for Budget Recommendations

Guideline for Budget Recommendations

There is certainly no shortage of things we can do with money, but where should our money really be spent? Consider these benchmarks when setting up your budget.

Budget Savings

Throughout your career, save 10% of your income. Start saving for other goals once you have an emergency fund of between 3-6 months’ income.


Keep all other consumer debts to no more than 15% of your net income: student loans, retail installment contracts, credit cards, personal loans, tax debts, and medical debts.

Related: 10 Steps to Get Out of Debt on a Low Income


Transportation costs should not exceed 15% of net income. This includes car insurance, car payments, tags or licenses, maintenance, gasoline, and parking.


Household expenses should not exceed 35% of net income. There are many expenses associated with renting or owning a home, including mortgage/rent, utilities, insurance, taxes, and home maintenance.

Related: 5 Home Buying Tips for a Crowded Market

Budget for Other Expenses

All other expenses should be kept under 25% of net income: food, clothing, entertainment, childcare, medical expenses, tithing, and vacations.

This is simply a guideline, not a set of requirements. While every financial situation is unique, making sure your budget fits the suggested guidelines on a regular basis is a good way to stay on track and avoid future problems.

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