How to budget like a Millenial

You ever read that article about how millennials have 0 money in their balance account?

Have you heard the news that most of us are drowning in debt?

Do you wanna prove all that fake news wrong once and for all?

Well, I can’t promise this guide will be able to stop your pill addiction or takeaway compulsion (you should really eat that chicken sandwich you saved from last monday’s lunch) but I can tell you what I’m working towards. You can decide for yourself if this is something that might work for you, or otherwise see it as a guide on how not to act as a millennial.

So! Let’s stop talking and crunch some numbers. For generalization purposes I decided to budget in percentage values based on monthly income, this way we can apply the system to different levels of income; it’s also macro enough for a newbie to budgeting.

Number one — Survivability

First priority for a living being is staying alive, so I would recommend starting with groceries. For a single person (because everyone is alone deep inside) I wouldn’t spend more than 7.5% of your monthly income on eating - in the end it all goes to shit, innit.

Also account for beverages (pro tip: stop drinking alcohol and sodas — it makes you healthier, prettier, edgy and less poor).

Summary:

Current: 100 %
Groceries: 7.5%

Remaining: 92.5%

Number two — Survivability 2

I would recommend rent (or mortgage if you’re ahead of the curve) as a second priority. Statistics says that having a home boosts your survivability chances by quite a bit.

Rent is one of the most dynamic aspects in this list as it is based on your current level of income, location, personal preference and marital status. A possible range would be from 5% to up to 40%. I personally advise my fellow millennials to be smart and lean towards the punk lifestyle, aiming for somewhere in between 15% and 20% if possible. However; if other priorities arise, such as selfcare or finding your soulmate, go for that sweet 35% and boost your sex appeal with a nice kitchen and a double bed instead of a futon. (This might become a future investment — managing to trick another millennial into joining your campaign might split the Number two budget in half.)

PS: bills included

Summary:

Current: 92.5%
Rent(/mortgage) + bills: 20%

Remaining: 72.5%

Number three — Present

After not dying I would say making the most of what you get is next in our priorities (in this case not being in ******* debt). Now there are a few exceptions, such as student debt or low interest loans, but leaving aside these for now, pay the damn credit card/overdraft bill! There is no reason for you to be in debt. Like no reason. Unless you have a flu and live in the States then get flu shot and have to sell your parents house without their consent on the darkweb.

Before thinking about savings and “enjoying the best time of your life”, budget for a reasonably debt free present. This enhances your ability to level up faster in general.

This is based on your current situation but let’s account for debt amounting somewhere from 0% (the lucky 0.00001% of millenials) to 30% (the less than lucky fellows).

Summary:

Current: 72.5%
Debt: 15%

Remaining: 57.5%

Number four — Present 2

Now because we living like there’s no tomorrow, let’s inject some cash into what we like most: consumerism. Now that could be something like gym — supplements — sport or videogames — gigs — cinema — going out (takeaway included).

For the more sophisticated peeps, include your kinks and off the bill spendings, i.e. online memberships and internet shopping. But remember: don’t go over 25%. This is money that you literally threw away yesterday.

Now, what I would personally suggest is to make a pot and save some money each month; a bigger purchase might be worth more than 10 smaller ones. It also helps if you think twice about flexing with that iPhone Xs or sweet Balenciaga bag — are they as much fun as a 2002 motorbike??

Summary:

Current: 57.5%
Flex: 25%

Remaining: 32.5%

Number five — future

This category merges two smaller ones: savings and emergency fund. I would suggest starting with the latter. As soon as you save 300% in your Monzo pot, you’re ready to look into savings, pension, investments and so.

I wanna keep it short and say saving is the most value you can make of your money at this very moment. Plan to get on the property ladder, go on a trip around the world, invest for early retirement or just become a millionaire.

Put as much as you want in here and tomorrow you will thank your present self.

Summary:

Current: 32.5%
Savings: All the %

Remaining: 0%

The only thing i wanna add is thatthis is supposed to be a starter budget. There will be a more indepth guide, focusing on each of the steps with various options catering to specific scenarios. For now, starting to budgeting is
puting you ahead of the curve and there’s nothing better than being on top (of the wave).

Please feel free to @senzaditheo if you have any advice or question and good luck!