Monthly Budget
To help you keep track of your finances, consider breaking up your monthly budget into the following categories:
- Housing – mortgage payments, property taxes, utilities, etc.
- Transit – car payments or transit passes, gas, maintenance, etc.
- Debt – payments to credit cards, lines of credit, etc.
- Savings – your long-term savings for retirement, etc.
- Life – food, vacations, fun, medical, childcare, etc.
From there, you would want to look at how much you spend on each category. The below is a good rule of thumb:
- Housing – 35% of your monthly income
- Transit – 15% of your monthly income.
- Debt – 15% of your monthly income
- Savings – 10% of your monthly income
- Life – 25% of your monthly income
By spending too much on housing, you are forced to sacrifice in other areas of spending such as your life or savings, but it is better to be life RICH than house POOR.
If you’re not sure what you should budget for your new home, or have questions about making your home costs more affordable (such as changing your mortgage payments), please don’t hesitate to reach out to me today!
