Budgeting is simple but not easy.

Use the 80/20 rule.

The big expenses in your life determine the rest of your financial life.

What percentage of your income is your rent?

What percentage of your income does your car expenses, like fuel, servicing & insurance take?

What percentage of your income does school fees for your kids take?

Make those decisions very carefully. They will affect your financial life greatly.

If you are struggling financially, and you have a decent income, and you aren’t in debt, revisit those big financial decisions.

Before you obsess on tracking your expenses to the last coin, take care of the big financial decisions in your life. The small ones don’t matter that much.

After your main expenses, how much money do you have left? This is called Discretionary income.

What remains after a person pays their fixed &  essential costs like rent, food, and clothing.

It’s not how much you earn that matters, it’s how much discretionary income you have. You can only increase your discretionary income by reducing the *big* expenses.

Be a conscious spender. Spend extravagantly on the things you love and mercilessly cut down costs on everything else.

Here’s an example from Ramit Sethi’s book, “I’ll teach you to be rich.” “My friend Jim once called me to tell me that he’d gotten a raise at work. On the same day, he moved into a smaller apartment. Why? Because he doesn’t care very much about where he lives, but he loves spending money on camping and biking. That’s called conscious spending.”