Master Your Monthly Budget with This Proven 7-Step
Formula (Perfect for Indian Households)
Budgeting
isn’t just writing numbers on paper — it’s a financial system that ensures your
money goes where it should. Here's a powerful 7-step plan to help you budget
better.
🔷 Step 1: Know Your Net Income
Don’t
calculate based on your gross income. Remove:
- Taxes
- Loan EMIs
- Provident fund (if not
liquid)
Track
your exact cash in hand. That’s your starting point.
🔷 Step 2: Categorize Your Expenses
Split
spending into:
- Fixed: Rent, EMIs, school
fees
- Variable: Food, shopping,
petrol
- Occasional: Annual
insurance, birthdays
Use
digital apps or handwritten charts — whichever suits you.
🔷 Step 3: Use the 60-20-20 Rule
(Indianized)
- 60% needs (rent, food,
transport)
- 20% savings/investments
- 20% lifestyle (Netflix,
dining out, gadgets)
This
model offers more flexibility for middle-class households than the Western
50-30-20 split.
🔷 Step 4: Set Monthly Financial
Goals
Examples:
- Save ₹10,000 this month
- Cut food delivery by 50%
- Start an emergency fund with
₹5,000
Goals
give your budget direction.
🔷 Step 5: Automate Where Possible
Set
automatic transfers:
- SIPs on 5th of every month
- RD transfers
- Bill auto-payments
Automation
eliminates “decision fatigue” and late fees.
🔷 Step 6: Track & Adjust
Weekly
Use apps
like:
- Monefy
- Wallet
- Goodbudget
Or keep a
simple Google Sheet. Spend 10 minutes every Sunday reviewing expenses.
🔷 Step 7: Review at Month-End
Ask:
- Did I stick to the plan?
- Where did I overspend?
- What can I improve?
This reflection
turns your budget into a growth tool.
✅ Conclusion
Budgeting
is not punishment — it’s permission to spend with awareness. When you
follow this 7-step formula, you don’t just save money — you gain control over
your financial life.
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