America's Debt Diet Spending Plan Pie Chart

[tgavin71]

Yesterday on the debt diet show aired in Australia one of the advisors was talking about the spending pie chart. With the following percentages.

Housing 35%
Mortgage/rent, repairs, taxes, utilities, insurance

Debt 15%
Student loans, credit cards, personal loans


Transport 15%
Car Payments, gas, insurance, repairs, parking, tolls, fares

Other living 25%
Eating out, vacations, entertainment, clothing

Saving 10%

Two questions . Where does food, education and medical expenses fit in? If it is in other living surely it would be ahead of eating out etc. And secondly in regard to savings what exactly are savings for?
I am so confused.

[PRICEPLUS]

Re: America's Debt Diet Spending Plan Pie Chart

Everyones pie chart is going to be different. Where you live and how you live determines quite a bit. How much you make does as well. Then there are debts you take on such as loans and CCs. You make a pie that works for you!

[Haku]

Re: America's Debt Diet Spending Plan Pie Chart

This is regarding to how one should budget their expenses right?

If so, these percentages could mean very different things to someone who is in a high income bracket as opposed to someone who is in the low income bracket.

Instead, I prefer to work with whole numbers, and I prioritize all my monthly expenses. For example, the first and most important expense is my rent. I know exactly how much that's going to cost me each month and I save accordingly for it. I subtract that from my net income figure and then budget in my next most important bill, which would be utilities. So on and so forth.

I don't mean to insult anyone's intelligence here, but the point is, I don't work with percentages.

Also, I itemize each and every individual expense, and place them in the order of importance to me. In this way, categories also become irrelevant. You just don't need it.

Of course, my budget also includes money that goes towards saving and investing. They're near the bottom of my list, but only because I natually want to throw every available penny I have at my debts and retirement accounts anyway. So, I'm not afraid that they'll get lost in the shuffle.