Build a Responsible Budget with the 60% Solution

Despite the content of his site, financial blogger J.D. Roth isn’t a budgeter—opting instead to follow what he calls a “spending plan.” But in the wake of some financial changes, he’s decided it’s time to build his first budget. His choice and suggestion for anyone looking to set up their first real budget is called the 60% solution, which allocates the lion’s share of your gross monthly income to committed expenses (like rent and car insurance), then divvies up the remaining 40% equally to retirement, irregular expenses, long-term savings, and “fun money.” The 60% solution, as Roth points out, is intended for recent college grads, but it should also work well as a starting point if you’re on your first budget. If you’ve already got a tried-and-true budgeting plan, share what works for you in the comments.