Good budgeting: Finding your perfect match
Written and accurate as at: Jan 14, 2026 Current Stats & Facts
There’s no one-size-fits-all approach to managing your money. And especially when it comes to budgeting, the method that works for one person might feel restrictive or unrealistic for another.
Finding the right system can take a bit of trial and error, but once you do, budgeting can feel less like a chore and more like a natural part of your life. Below, we break down some of the most popular budgeting methods, and how to tell which one might work best for you.
The 50/30/20 method
If you’ve ever tried to be more mindful with your money, chances are you used some version of the 50/30/20 method, perhaps without even realising it. At its core, it’s a simple approach for dividing your income according to your priorities.
Around 50% of your income goes towards essentials like rent or mortgage payments, groceries, utilities and transport. The next 30% is for wants, which covers non-essentials such as eating out, entertainment and lifestyle spending. And the remaining 20% is for savings or paying down debt.
If you're new to budgeting or have found other approaches overwhelming, you might find this approach much easier to handle. Grouping expenses into broad categories encourages you to pause and think about whether something is a need or a want, without requiring you to track every dollar too closely.
And over time, the ratios don’t have to stay fixed – you can adjust them to suit your goals as they change. For example, you might temporarily increase the savings portion if you’re planning to buy a home or go on a holiday.
Zero-based method
The zero-based method won’t be for everyone, as it requires a degree of foresight and planning that many people just won’t have time for. But for those who want clearer boundaries around spending or a more intentional relationship with their finances, it can work wonders.
You start by listing your income and all your planned expenses for the month, then you go through each expense and decide if it’s really needed. If it is, it stays on the list; if it isn’t, you take that money and direct it elsewhere.
The goal, of course, isn’t to spend everything you earn but to make sure every dollar is accounted for. By the end of the process, the amount of unassigned money should be zero. Everything has a purpose, even if that purpose is simply to be saved.
Pay yourself first method
The pay yourself first method, sometimes called reverse budgeting, turns the usual approach to saving money on its head. Instead of saving whatever is left over at the end of the month, you set aside money for savings or investing as soon as you get paid.
Fans of this method like it because it forces you to be consistent. Savings are treated as a fixed line item in your budget, which can lead to much more steady growth over time.
This can be done in a number of ways, from automatic transfers into savings or investment accounts to manual transfers on payday. Once that money is set aside, whatever remains is yours to spend.
This approach tends to work best when your expenses are fairly predictable (and you can remain disciplined). It also helps to review your spending upfront, so you have a clear idea of how much you can realistically afford to save without putting undue pressure on yourself.
Envelope method
The envelope method is a modern take on an old practice, in which families would divide cash into physical envelopes for different expenses. These days, it usually involves spreading money across different accounts or categories in your budget.
Many budgeting apps make this easy by organising your spending into categories, and some banks let you open multiple accounts for different goals. But there’s no harm in going low-tech and relying on a simple spreadsheet or even pen and paper.
Whatever your preferred approach, the envelope method is easy to set up, easy to adjust, and can be as simple or detailed as you need it to be. If you’re looking for a low pressure way to stay organised, it can be a good place to start.