The Problem No One Talks About

Meet Priya, a 28-year-old marketing executive earning ₹85,000 monthly in Delhi. Every month, she’s surprised when her account balance plummets despite what should be substantial savings. “Where does the money go?” she asks. Ordering food instead of cooking, OTT subscriptions, weekend outings, impulse online shopping, and small expenses that quietly drain her savings.

Priya isn’t alone. Most Indians struggle with money management, not because they earn too little, but because they spend without a system. Budgeting is the key to the difference between financial chaos and financial peace.

Why Budgeting Matters More Than Your Salary

Traditional wisdom says: earn more, save more. But here’s the truth: You don’t need a ₹2 lakh salary to build wealth. You need a plan for the ₹85,000 you already earn.​

Budgeting is not about deprivation. It’s about making a conscious choice, knowing exactly where every rupee goes and ensuring it aligns with your priorities.​

The 50/30/20 Rule: Your Budget Blueprint

The simplest, most effective budgeting framework is the 50/30/20 rule. After calculating your after-tax income, divide it into three buckets:​

50% for Needs (Essential Expenses)

These are non-negotiable costs required for basic living.​

Includes:

• Rent or home loan EMI​
• Groceries and utilities (electricity, water, gas)​
• Transportation (petrol, public transport)​
• School fees and education​
• Insurance premiums (life, health)​
• Loan repayments and minimum credit card payments​
• Healthcare expenses​
• 30% for Wants (Discretionary Spending)

These are lifestyle choices that enhance enjoyment but aren’t essential.​

Includes:

• Dining out and food delivery (Zomato, Swiggy)​
• Entertainment (movies, OTT subscriptions, Netflix, Prime)​
• Weekend outings and shopping (clothes, gadgets)​
• Hobby memberships (gym, clubs)​
• Festival shopping and celebrations​
• Travel and vacations​
• 20% for Savings & Investments

This is your financial future fund.​

Includes:

• Emergency fund​
• Monthly SIP in mutual funds​
• Retirement contributions​ towards a guaranteed pension 
• Child education funds​
• Additional loan repayment (beyond minimum)​
• Investments toward long-term goals​

Real Example: Rohit’s Budget in Bangalore

 

Let’s apply this to a real Indian household:​
Monthly Income After Tax: ₹80,000
50% for Needs (₹40,000)

• Rent: ₹20,000
• Groceries: ₹8,000
• Utilities (electricity, water, internet): ₹4,000
• Transportation (fuel/cab): ₹5,000
• Minimum personal loan EMI: ₹3,000

30% for Wants (₹24,000)

• Eating out: ₹6,000
• OTT subscriptions (Netflix, Prime): ₹2,000
• Weekend outings and shopping: ₹5,000
• Diwali/festival shopping: ₹11,000 (spread over months)

20% for Savings (₹16,000)

• Emergency fund SIP/Liquid Funds: ₹4,000 
• ULIP/SIP in equity mutual funds: ₹6,000 
• Pension Plan:  ₹6,000

This single plan gives Rohit complete clarity and peace of mind.​

Does 50/30/20 Work for All Indian Households?

Short answer: It’s a starting point, not a rigid rule.​

In India, context matters. Joint families might spend 60-70% on needs due to larger household sizes. High-rent cities like Mumbai might need 55% for housing alone. Self-employed professionals with irregular income need flexibility.​

The beauty of 50/30/20 is adaptability. If your needs are 55%, adjust: 55% needs, 25% wants, 20% savings. The critical rule is never to skip the 20% savings.​

Step-by-Step: Create Your Personal Budget

Step 1: Calculate Your After-Tax Income

Include salary, bonus, freelance income, rental income, or pension. Be realistic—use net income, not gross.​

Step 2: Track Expenses for One Month

Write down or use an app to log every rupee spent for 30 days. This reveals your actual spending patterns.​

Common tracking apps: Moneyview, Goodbudget, Walnut, Money View, ET Money.​

Step 3: Categorize Your Spending

Sort all expenses into needs, wants, and savings.​

Step 4: Compare vs. 50/30/20

Are your needs 60%? Wants 25%? Savings only 15%? Identify where you’re overspending.​

Step 5: Make Cuts

Common areas to reduce:​

• Dining out (₹500-2,000/month savings possible)
• Unused subscriptions (₹500-1,500/month)
• Impulse online shopping (₹1,000-3,000/month)
• Excessive cabs (₹1,000-2,000/month)

Total potential savings: ₹3,000-6,500 monthly without lifestyle compromise.​

Step 6: Automate Savings

The moment your salary arrives, transfer your 20% savings to a separate account before spending. This “pay yourself first” approach ensures savings happens.​

Step 7: Review Monthly

Every month, check if you stayed within limits. Adjust for upcoming expenses like school fees or festival shopping.​

Common Budgeting Mistakes

Mistake 1: Ignoring Small Expenses

₹100 daily on chai + snacks = ₹3,000 monthly = ₹36,000 yearly. Small expenses compound into significant leakage.​

Mistake 2: Not Tracking Cash Spending

Cash disappears into thin air. Digital payments leave a trail. Try to use cards/UPI for most purchases.​

Mistake 3: Skipping Emergency Fund

“I’ll save for emergency later,” you tell yourself. Life happens first. Your car breaks down, someone gets sick—without an emergency fund, you’ll take debt.​

Mistake 4: Lifestyle Inflation

Your salary increased by ₹10,000. Did your savings increase or your wants? Discipline is essential to break this cycle.​

Mistake 5: Not Planning for Festivals

Diwali, Holi, weddings—predictable but often unbudgeted. Allocate small monthly amounts (₹1,000-2,000) so you’re not caught off guard.​

 

The 60:30:10 Alternative

If you’re paying a heavy EMI (home or vehicle loan) or living in high-cost cities, try this:​

• 60% for needs
• 25% for wants
• 15% for savings

Once EMIs finish, shift back to 50/30/20 and increase savings to 35%.

Real-Life Challenge: Joint Family Budget

Situation: Extended family (parents, wife, two kids) on ₹1,25,000 combined monthly income.

Needs (60% = ₹75,000)

• House rent: ₹25,000
• Groceries/provisions: ₹20,000
• School fees: ₹12,000
• Utilities and transportation: ₹10,000
• Insurance and healthcare: ₹8,000

Wants (25% = ₹31,250)

• Dining/parties: ₹8,000
• Entertainment: ₹5,000
• Shopping: ₹10,000
• Gifts/social functions: ₹8,250

Savings (15% = ₹18,750)

• Emergency fund/savings: ₹8,750
• SIP/investments: ₹7,000
• Children’s education: ₹3,000

This structure works for joint families without sacrificing comfort.​

Technology: Budget Apps That Work for Indians

Instead of manual tracking, use apps designed for Indian households:​

• Moneyview: Auto-syncs with bank, categorizes spending​
• Goodbudget: Digital envelope system, shared budgeting for couples​
• Walnut: AI-powered with multiple currency support​
• Money View/ET Money: Comprehensive financial tracking​
• jUMPP: AI predicts expenses and suggests budgets​

Most are free with optional premium features. They eliminate the excuse “I don’t know where money goes.”​

Your Action Plan This Week

Day 1-2: Calculate your exact after-tax monthly income.

Day 3-4: Track every single rupee spent for these two days using pen/app.

Day 5: Categorize your actual spending into needs, wants, savings.

Day 6: Compare your current allocation to 50/30/20. Where are you overspending?

Day 7: Download a budgeting app and set it up. Enable notifications when approaching your 30% want limit.

The Final Truth

Budgeting isn’t about being cheap. It’s about being intentional.​

When Priya started budgeting using 50/30/20, she didn’t feel deprived. She still ate out (but planned it better), still subscribed to Netflix (but cancelled unused ones), and still enjoyed life. But now, she also saved ₹18,000 monthly instead of ₹3,000.

In one year, she built a ₹2.16 lakh emergency fund. In two years, she’ll have a down payment ready for her house.

You don’t need a salary increase. You need a budget—and the discipline to follow it.

What’s one discretionary expense you’ll cut starting this week?

Stop wondering where your money goes. Start making it work for you.

Whether you’re struggling to save, drowning in EMIs, or ready to optimise your finances for maximum growth, I am here to help you.

📞 Schedule a Call for Financial Goal Assessment Today
🌐 Visit: www.horizunfinancialservices.net
📱 Call/WhatsApp: +91 98205 04945

Financial freedom begins with a budget. Let us help you master it and achieve your dreams.