A few months ago, I came home from work on a rainy day to discover the ceiling in my apartment was leaking. To be perfectly clear, I'm not talking a few sporadic drops of water here and there. The entire kitchen was a mess. Giant patches of ceiling had fallen onto the floor, which was then covered with about two inches of water, and my rugs, furniture, and artwork were completely waterlogged.
As I scrambled around to find pots and pans, and called my landlord to fix the ceiling for the umpteenth time, something became crystal clear. It was time to get serious about moving into a nicer place—which, in turn, meant getting serious about putting together a budget.
I've had budgets in the past, but never fully committed to them for one reason or another. Either they were too time consuming to manage, or so strict that they didn't allow for any fun. Fidelity's 50/15/5 guide turned things around for me. It’s a simple approach to budgeting that categorizes your expenses into three key areas. The good news? You don't have to account for every penny. Because let's be realistic: Having a budget shouldn't mean that you don’t get to have a life. Below is how Fidelity explains the 50/15/5 guide.
Already got a budget? Use our Budget Checkup to see how it stacks up.
THE BOTTOM LINE:
Sticking to a budget isn't always easy. But don't wait until your ceiling comes crashing down to start getting serious about it. Thanks to the 50/15/5 guide, looks like my nice new apartment might finally be in the cards.
TAKE THE NEXT STEP
Use our simple Budget Checkup tool to see if your spending and saving is in line with the 50/15/5 guide.