![]() As I’m self-employed, my health insurance costs are very high. Using myself as an example: I prefer to save much more than 10% of my income. And some people’s expenses just might not fit within these guidelines, such as school supplies if you have children or alimony if you’re obligated to pay it. There are other budgeting categories you may want to include, and other ways you may want to classify your expenses. Also, according to Ramsey, you shouldn’t start saving for retirement until you have a fully-funded three-month emergency fund.Īnother note is that these spending categories are just one way to organize your budget. That requires minimizing your expenses in other categories (as well as making more money) and putting everything you can into paying down your debt. Ramsey recommends putting as much as possible towards your non-mortgage debt, such as student loan payments, personal loans, or credit card bills. What about debt? One category missing from the list above is personal debt. Miscellaneous - The “stuff you forgot to budget for” category.Personal spending - Personal care, haircuts, Amazon purchases, clothes, shoes, home furnishings, home decor, etc.Any lifestyle expenses, such as gym memberships or kids’ activities, as well as entertainment expenses like Netflix, Hulu, sporting events, concert tickets, babysitters, and travel. Auto insurance and home insurance is placed within transportation and housing categories. Insurance - Life insurance, health insurance, and disability insurance.Health - Medical and health care bills (not including health insurance premiums) such as co-pays for doctor visits, prescriptions, and dental care.Transportation - Any and all transportation costs, including public transportation, car insurance, oil changes, car payment, gas, DMV fees, and parking.Housing costs - Rent or mortgage payment, along with property tax, home or renters insurance, home maintenance, HOA fees, and PMI.Utilities - Cell phone, cable, internet, gas, and electricity.Food - Includes both grocery shopping and eating out.Saving - Saving 10% of your income for retirement, which ideally is within a 401(k) or IRA.Giving - Ramsey recommends giving 10% of your monthly income to worthy causes.Here’s a breakdown of each category, based on Dave Ramsey’s advice:
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