Published On: Sun, Jan 2nd, 2022

2022 budgeting: How the ’50/30/20′ rule can help you pay off debt & contribute to savings | Personal Finance | Finance

Money-saving tips have been issued for 2022 as Britons look to recover from a difficult economic period. Peter Kimpton, the Chief Operating Officer and Personal Finance expert at Family Money, shared how a simple rule could set people off to a strong start.

Mr Kimpton broke down how the “50/30/20 rule” could pay dividends down the line.

He said: “Try budgeting methods such as the 50/30/20 rule, which is an easy budgeting method that can help you to manage your money simply, effectively and sustainably.

“The rule suggests dividing your monthly income into three spending categories: 50 percent for needs, 30 percent for wants and 20 percent for your financial goals.

“The 50 percent towards needs includes regular essential outgoings such as rent, mortgage and bills. 30 percent should be set aside for ‘wants’ such as hobbies, shopping or subscriptions.

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“Fuel can be a large expense for drivers in the UK, keeping a close eye on fuel costs and making small changes can help you save money each month.

“Start by looking for the best prices in your local area, by using a cheaper petrol station could save you a few pence for every litre. It is also worth taking advantage of loyalty card schemes, collecting points the more you fill-up, the more points you can earn to exchange for money-off vouchers.”

Mr Kimpton concluded by turning his attention to the modern elements of the 21st century economy.

Many families rely on the online world for their entertainment and shopping needs but the spending on these elements can quickly skyrocket.

Mr Kimpton concluded: “It is worth checking your current subscription plans.

“Whether it’s fitness apps, TV or magazine subscriptions, it’s easy to sign up to different services and then forget about them but still be paying a set price each month.

“It is the perfect time to start fresh in 2022 with your subscriptions and to cancel any unnecessary payments. To do this take a look at your transactions and make a list of all the subscription services you’re paying for.

“Are there any you don’t use? Start by cutting those. Even with the subscriptions, you do use, question if you could try cutting those temporarily to see whether or not you miss them.

“If you shop online, always make sure to always spend an extra five minutes searching for a discount code.

“Sometimes, you may have to do something like sign up for a newsletter to receive a discount off your next order.

“Other times there may be a promo code you can find that will offer you a better deal.

“This can help you save money each time when shopping online by finding the latest discounts.”

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