Budgeting my expenses
Updated: Feb 22, 2020
As mentioned in my other post (The Goal - 5W1H), to achieve the retirement goal with $60,000 passive income by 2035 (the equivalent of $5,000 passive income monthly), I will have to reduce expenses incurred. In order to achieve that, a budget created can come in handy to scrutinize where the money is flowing in/out.
As you can see from above, the total for my personal expenses amounts to 50% of my salary. This means that for every $1000 earned, I have spent $500 of it, leaving only $500 for my savings and investments. The good news is that these expenses can be controlled and I will most certainly be cutting down on them by changing my lifestyle.
These will be the few changes to my personal expenses:
1) Removing the "Gym". Rather than signing up for gym membership, I will be investing in gym equipment and do a home-gym instead. That will save me 4% to invest/save and not compromising on my health - a win-win situation.
2) Cutting down on "Others" to 30%. These expenses include the amount paid for daily allowance and special occasions such as birthday and purchasing of luxury items.
With an extra savings of 16% of my salary, it will help me substantially to achieve the retirement goal - which makes it even more possible.