The 50/30/20 rule is one of the simpler budgeting techniques. You save 50 for what you need (bills, food, etc.), 30 for what you want (restaurant meals, travel, etc.), and 20 to put in your bank account (debt, retirement, investment, savings, etc.). You may change it to your liking if needed, for example, combine some if you don't need to pay bills, but the base model is one of the simplest budgeting techniques that all ages can enjoy.

Matthew Leon

The cash envelope system is a budgeting method used to track the exact amount of money in each budget line, using labeled envelopes. This way of budgeting is great for avoiding overspending and practicing discipline. To use this method, set a budget first. Then withdraw cash and create envelopes with a certain amount of cash to use, for example, $100 set aside for groceries. Only spend what you have in the envelopes. The benefits of this method are it holds one accountable for their spending and is an enforcer. The downsides are having to carry a lot of cash around and being time-consuming.

Amin Ezzat

Zero-Based Budgeting is a budgeting strategy where the total income of a person minus their total expenses is equal to zero. The process of zero-based budgeting starts from a "zero base," and every function within an organization is analyzed for its needs and costs. The budgets are then built around what is needed for the upcoming period, regardless of whether each budget is higher or lower than the previous one.

Zero Based Budgeting can be helpful for people of a variety of jobs, regardless whether their income is fixed or fluctuating.

Fixed: Ensures precise allocation of every dollar to specific categories and expenses, enabling a detailed plan that aligns spending with individual needs and goals. By assigning each dollar a purpose, unnecessary expenses are avoided, maximizing the benefits of fixed income.

Fluctuating: Allows to adjust budget based on income changes, prioritizing essentials. Surplus funds from higher-income periods can go towards savings and goals, while lower-income periods require budget adjustments to focus on essentials and reduce discretionary spending.

Potential Problems

Time consuming and resource intensive to create a new budget monthly

Can lead to a focus on resolving short-term problems and neglect of long term goals

Another type of budgeting method is the pay yourself first method. This is when you set aside a select amount of money for loan and debt payments, to prioritize paying back owed money. The rest of the money should then be split into other categories, and used as you see fit. It is also recommended that you set some of the extra money away for an emergency fund. One benefit of this method is prioritizing your debt repayment. One downside is not having a lot of structure other than debt repayment. Because of a lack of structure to this method, this method would be good for someone who already has a good sense of budgeting, and is able to split their money appropriately. It would also be good for those who have a lot of debt, and want to prioritize paying it off.

Mackenzie Luk

For those who have trouble remembering to paying finances on time or don’t want the manual hassle of worrying to pay finances off by a deadline, the automated budgeting method could be for you. This method utilizes a computer system to automatically pay off finances such as credit cards, loans, or rent payments among other things. The main advantage is that you will always pay off your finances by a set date of your choosing. This ensures that you will never miss a payment and worry about making a payment.

Darren San

The goal of activity-based budgeting is to allocate resources based on specific activities or task undertaken by different departments. Traditional budgeting methods often rely on historical data and simply adjust the previous year’s budget, which may not align with the current goals and activities of the organization. Activity-based budgeting, on the other hand, emphasizes a more detailed analysis of the activities and costs associated with each activity. Overall, the main advantage of activity-based budgeting is its ability to enhance cost accuracy, optimize resource allocation, support decision-making, and improve overall organizational performance by aligning the budget with the specific activities that drive value and contribute to success.

Alden Thai

The value proposition budget system is prioritizing items based on their values. This ensures that the money you spend is being spent on something useful and worth it. This focuses on investments and drives revenue through the roof. It also increases your ROI, or return on investment. This strategy mainly focuses on money coming in with the right amount coming out.

Tarek Zaher