A personal budget structure can be a lifesaver if you have no idea how to start living frugally.

With a personal budget structure, all you’ll have to do is fill in the values. After writing down how much you earn, your different expenses and their categories, you will have a plan that will guarantee you a secure and wealthy future if you follow it. Even experienced budgeteers use these structures to help them make the perfect personal budget plan.

After reading this article, you will have a firm grasp on what a personal budget structure is, and how you can use it to head to your financial success.

What is a personal budget structure?

A personal budget structure is a budgeting plan made by experts that everybody can adapt into their own lives.

These plans are easy to setup and follow, and everybody can make their own by following the template. Through the use of a budget structure, people don’t need to study how much they need to allot into a certain expense or how much they need to save.

Another great benefit of using personal budget structures is they keep you from making common budgeting mistakes.

Because the structure is already there, all you have to do is follow it. These plans keep you from spending too much and placing money on the wrong expenses. They keep you grounded, and they remind you of your financial goals.

All in all, for beginners and experienced alike, personal budget structures are amazing.

Personal Budget Structure for Beginners

50/30/20 Structure

If you’ve done your research on personal budget structures, then you’ve most likely come across the 50/30/20 Structure.

This structure basically follows a simple setup: 50% of income goes to needs, 30% of income goes to wants, and 20% of income goes to savings. This personal budget structure was popularized by Elizabeth Warren, and a lot of financial enthusiasts swear by it. Not only is it simple, but it’s also easy to follow.

The 50/30/20 structure is perfect if you want a quick and easy type of structure.

Zero-based three bucket structure

This takes a bit more control and monitoring compared to the 50/30/20.

This structure is the categorized version of a zero-based budget. A zero-based budget structure takes all of your income into account. By the end of your budget planning, you would have £0 left in your budget, which is where it gets its name from. The three bucket structure refers to separating your expenses into: essentials, financial goals, and non-essentials.

You can setup this personal budget structure in three easy steps:

1. Identify monthly income and expenses
2. Categorize into three buckets: essentials, financial goals, and non-essentials.
3. Make sure you’ve got zero left in the budget

Although it takes much more work to set up, this budget plan has more direction and definition compared to the 50/30/20 structure.

Combining the two

The great thing about using personal budget structures is you can combine the techniques in them to create something tailored for you.

The 50/30/20 structure discusses where to allot the income, while the zero-based three-bucket structure makes sure that you will take all of your income into account. By utilizing the 50/30/20 mindset while doing the zero-based three-bucket structure, you have yourself a pretty solid structure.

By combining the two, you’re keeping track of all of your income while making sure that not a single part of your life is taken for granted.

Personal Budget Structure in a Nutshell

Personal budget structures are perfect if you need an easy way to setup a personal budget plan.

It’s perfect for beginners and experienced alike, and they provide different benefits, one of which is they keep you from your bad spending habits. Two examples of budget structures are the 50/30/20 structure, and the zero-based three-bucket structure. The 50/30/20 structure focuses more on where the money goes, and the zero-based three-bucket structure focuses more on taking into account every pound you earn.

The great thing about these two structures is you can use them on top of each other.