Select Page

Made a budget but don’t know where to go next? Staring at an income and expenditure column but not sure what to do with it? Drawn a beautiful budget pie chart but can’t afford the colouring pencils to really bring it to life? If your answer to any, or all, of these questions, is, “For the love of God, Yes!”. Or even just a simple affirmative nod; then this blog post is for you.


I’m going to talk you through 3 different personal budgeting strategies that can save you cash.


The American Democrat


Earning this title through its association with Elizabeth Warren, a prominent US democratic politician, who developed this budgeting strategy. Officially known as the 50/30/20 method of budgeting it works on a simple premise.


  • Start with your total income, say £1200 for a month. 50% (£600) of that amount should be going on essentials, such as rent and food.
  • Next, the following 30% (£360) should be spent on personal expenses. Meals out, gym memberships and other non-essential parts of your life.
  • Finally, the last 20% (£240) is put aside for savings.


Allocating your finances in this way helps you to see which areas of your spending you might need to reign in. If you are spending greater than 30% of your income on non-essential items then identify things that you can cut down on within that category. Of course, as a student, your income may not be all that much and putting money aside for savings is probably not a top priority at this stage. If that’s the case re-allocate some of that money into the other two categories.


The (hopefully not) Hunger Games


If you’re struggling on a regular basis to make ends meet then that calls for some drastic budgeting action. The (hopefully not) Hunger Games style of budgeting means that you account for every single penny or cent that you spend. So if you’re income is £1353.45 for one month, your expenditure for that month should also be £1353.45.


This style of budgeting requires some careful planning.


  • First, you need to know, with a fair degree of precision, what your income for a month will be.
  • Next, you need to identify exactly what you will be spending and where. Your self control skills will skyrocket.
  • Finally, at the end of the month, your budgeting should leave you with a nice clear balance sheet ready to begin afresh.


The Old Skool Budgeter


One for the traditionalists. Maybe you enjoy a good pair of slippers? Or relish writing letters on typewriter? Or gaze wistfully at images of Victorian cityscapes and yearn for simpler times? If yes, the Old Skool Budget method may suit you.


Firstly it’s super simple. Everything that can be paid for in cash, should be paid for in cash. Obviously your landlord may find it inconvenient if you roll up to pay rent with a wheelbarrow full of coins…so you don’t have to go to those kind of extremes. But if you go on a night out, or are wandering the supermarket, then your cards should be left securely at home. Only carry the cash you have set aside to spend. This reduces the opportunity to make impulse spending decisions that you later regret.


If you want to go the whole hog you can withdraw all the cash that you’ve set aside for non-essential spending at the start of the month. Acquire some envelopes, or fashion some from an available resource, and then allocate your money into these different receptacles. One could be for “eating out” that month, another for “trips to the shops”. Whatever your categories are, makes sure you only spend the money within each envelope on that particular thing.


Andrew Morton – Blackbullion instructional designer