Budgeting comes up as one of the ‘must do’ items if you want to be good with money. You must have a budget. You must stick to a budget. Whatever your budget of choice, there’s a zero based budget, a 50:30:20 budget, a 74:26 budget (really, in case you couldn’t tell, you can have any type of budget you want…).
But what problem does budgeting actually solve? 🤷🏻♀️
You never know when you suddenly need money. One day you may lose your job, become sick or simply encounter some unanticipated costs. Life is unpredictable and a money buffer (aka an “emergency fund” 🤓) seems like a wise idea.
But how much money should you put into this emergency fund?