Buying your next home?
See our home loan tools, articles and resources to help you explore your home loan options. We'll help you get to a good place.
Other types of budgets
We know that for some people, being totally granular about where their money is going makes them spin out, while others need to account for their spending to the last cent. All have their pros and cons – the key is to find a method that jives with your way of life and attitude. The most important thing you can do for your budget is stick to it – as best you can.
If you found our Budget Planner does not really work for you, here are a couple of other types of budgets that might be more your style.
This approach suggests dividing your salary into three buckets:
50% goes to your needs
The essentials for life, like home, bills, food, loan repayments – anything that can’t and shouldn’t be skipped.30% goes to your wants
The things that make life good, but you could give up if you had to.20% goes to your goals
This could be anything – travel, getting out of debt or even building up an emergency buffer.
It’s good to remember that those percentages are totally up to you. Our suggestion is to get the necessities out of the way and then split the rest however you like.
Use our 50/30/20 Budget tool to do the calculations for you!
Taking a tip out of the business world, this budgeting method is particularly relevant for freelancers, contractors or anyone who works odd jobs. It allows you to budget not just for what you need to spend your money on, but also where and when it might be coming in.
To do this, you’ll need to look at all your bills and spending as well as your clients or the seasonality of your work and the income it generates to have an idea of your personal ebbs and flows.
This budget technique suits people who like to really get into their numbers and plan ahead. Essentially, this approach means that there is no ‘leftover’ money at the end of the month – every cent is accounted for before you even get paid.
But while the 50/30/20 budget has some flexibility around things that fall in the same bucket, this approach specifies exactly how much you can spend on every item every month – and requires you to redo your budget every single month as things change.
Brain hack
Remember the "optimism bias" we mentioned earlier? That can also lead us to think we're going to excel at sticking to our budget even when we don't change our behaviour. A great way to get around this is to take some of the decision making out of your hands.
By setting up separate spending and saving accounts, and automating your budget to direct debit into them just after pay day, you’ll be two steps ahead and could have an easier time sticking to your budget. Plus, if you do need to move your money around because you want to buy something, the extra steps required can make you evaluate if the purchase is really necessary right now.
The information set out above is general in nature and has been prepared without taking into account your objectives, financial situation or needs. Before acting on the information, you should consider whether the information is appropriate for you having regard to your objectives, financial situation and needs. By providing this information ANZ does not intend to provide any financial advice or other advice or recommendations. You should seek independent financial, legal, tax and other relevant advice having regard to your particular circumstances.