Hello, Austin! Elevate Your Finances: Choosing the Right Budgeting Method for Your Business and Personal Life

Best Tacos in Austin!
Best tacos in Austin!

Hey there, Austinites! Picture this: you’re at your favorite breakfast taco spot in East Austin. You’re about to bite into that mouth-watering migas taco when you suddenly remember – you forgot to pay the electric bill. Or was it the car payment? Or maybe it was your rent? We will dive into budgeting methods!

If this sounds familiar, don’t fret – we’ve all been there. Juggling financial responsibilities can feel like trying to keep a flock of grackles from stealing your chips at a patio cafe. That’s where budgeting comes in.

A well-planned budget is like a roadmap for your finances. It helps you see where your money is going, plan for future expenses, make debt payments and make sure you’re saving enough for that dream trip to Marfa or that brisket-smoking class you’ve been eyeing.

Now, whether you’re running a small business right here in Austin or looking to make your personal finances as appetizing as Franklin Barbecue’s world-famous brisket, it’s essential to choose a budgeting method that suits you best. And that’s why we’re here today!

In this article, we’ll go over seven of the most popular budgeting methods. Whether you’re a small business owner, a startup enthusiast, or just trying to make your paycheck stretch a little further, we’ve got you covered. So sit back, grab a Topo Chico, and let’s dive in.

Value-Based Budgeting Method

First on our list is the Value-Based Budgeting method, a method as free and flexible as an Austinite on a sunny day at Barton Springs Pool. This method requires you to list your values and allocate your spending money accordingly. If tacos from Veracruz are your weakness, it’s totally okay to spend a little more on ‘Food & Dining,’ as long as you’re saving on other less important categories (Sorry, Kanye West concert tickets!).

Small business owners in Austin might find this method useful too. If your business values quality and customer satisfaction, don’t shy away from investing in high-grade materials or top-notch customer service training for your staff. After all, it’s what keeps the locals coming back!

The Balanced Money Formula (50/30/20 Rule)

Next up is the Balanced Money Formula, or as some call it, the 50/30/20 rule. This budgeting method is as balanced as a yoga class at Black Swan Yoga. It suggests that you should spend 50% of your after-tax income on needs, 30% on wants, and put the remaining 20% into savings.

Business owners might adjust these percentages based on their priorities. Maybe investing in growth (like a brand-new food truck) is more important than immediate profit. In that case, you could tweak the rule to fit your goals. Just don’t forget about that savings part, ya hear?

70/20/10 Budgeting Method

Now, let’s turn our attention to the 70/20/10 method. Think of it as the 50/30/20 rule with a twist, kind of like a breakfast taco with a surprise slice of avocado. Here’s how it breaks down: 70% of your income goes towards living expenses, 20% towards savings, and 10% towards debt. If you’re debt-free (good for you, by the way), that 10% can join the savings and debt payments party.

For business owners, this can be a viable option, especially if you’re dealing with loans. That 10% debt payment can help knock down those numbers faster than a Longhorn running loose on Sixth Street!

Sub-Savings Accounts Method

Fourth in line is the sub-savings accounts method. This method requires you to create different savings and checking accounts for various goals. It’s like having a separate jar for all your cravings: one for those mouth-watering banh mi from Elizabeth Street Cafe, another for the yearly Austin City Limits festival tickets, and maybe one for a shiny new bike from Mellow Johnny’s.

For a business owner, these separate “jars” could be for equipment upgrades, marketing campaigns, or even a fun team-building retreat (kayaking on Lady Bird Lake, anyone?).

80/20 Budgeting Method

Here comes the 80/20 method, as simple as a classic margarita from Fonda San Miguel. It suggests saving 20% of your income right off the top (pay yourself first, always pay yourself first budget), and the remaining 80% is yours to spend. This approach might suit you if you’re not big on tracking every single penny, and you’d rather keep things easy like Sunday morning.

For small business owners, it’s a simple rule to ensure you’re putting money back into the business while taking care of operational expenses.

Cash-Only Budgeting Method

If you’re old-school (or maybe just enjoy the feel of crisp bills), the cash-only budget might be up your alley. Here’s how it works: you withdraw a set amount of cash from bank account at the start of the week or month, divide it into categories (groceries, entertainment, etc.), and stick to it. No cards, no problem.

Remember though, this is Austin – we’re big on technology here. If you’ve gotten used to paying for your Franklin Barbecue with a swipe on your phone, this method might take some getting used to.

For businesses, this might not be the most practical method in our increasingly digital world, but it could work for some specific expenses or petty cash needs.

Zero-Based Budgeting Method

Last but not least, we have the zero-based budgeting method. This one is like doing a deep clean of your house – you’ve got to go through everything, but man, does it feel good when you’re done. It involves making your income minus expenses equal zero each month. It requires a lot of planning, and it can be time-consuming, but it’s effective.

For business owners, this method can be beneficial for getting a complete understanding of where every dollar is going. It’s also popular among startups, as it helps maximize efficiency and resource allocation.

Now that we’ve laid out the smorgasbord of budgeting options, it’s time for the fun part: choosing the right one for you! And remember, there’s no one-size-fits-all here, it’s all about finding what works best for your personal and business needs.

Choosing the Right Budgeting Method

Choosing the right budgeting method depends on your personal and business financial goals, lifestyle, and spending habits. Austin’s vibrant and diverse community has different needs, and what works for one person might not work for another. The key is to pick a method that aligns with your values, financial goals, and lifestyle, and stick to it consistently.

Q&A Section

Q: What are the four main types of budgeting methods?

A: The four main types of budgeting methods are the envelope system, zero-based budgeting, values-based budgeting, and the 50/30/20 rule.

Q: What is the 50/30/20 budget rule?

A: The 50/30/20 budget rule proposes allocating 50% of your income to needs, 30% of discretionary income to wants, and 20% to savings and debt repayment.

Q: What is the most effective budget plan?

A: The most effective budget plan is the one that best aligns with your financial situation, spending habits, and goals. What works best for one person might not work for another.

Q: What is the 70/20/10 rule money?

A: The 70/20/10 rule suggests dividing your after-tax income into 70% for expenses, 20% for savings, and 10% for charitable contributions.

Q: What is the 70% rule to plan your budget?

A: The 70% rule proposes spending only 70% of your take-home pay on expenses, with the remainder going towards savings and debt repayment.

Q: What are the best ways to budget personal finances?

A: The best ways to budget personal finances include understanding your income and expenses, setting financial goals, selecting a budgeting method, tracking your money, and adjusting monthly spending as needed.

Q: Which budgeting method is the best?

A: I wish I could just point to a method and say, “That’s the one, friend!” But budgeting methods are not one-size-fits-all. What works best depends on your individual financial situation, your goals, and your personal preferences.

Some folks swear by the precision of Zero-Based Budgeting, while others need the flexibility of the 50/30/20 rule. Test out a few methods to see which one suits your lifestyle and financial goals best.

Q: How do I decide what percentage to allocate to different areas of my budget?

A: Good question! The answer depends on a few things: your income, expenses, and financial goals. Basic needs like housing, food, and healthcare should take priority. After that, it’s up to you to decide what’s important.

Love watching the bats at Congress Avenue Bridge? Maybe allocate a bit more to leisure. Dream of opening your own food truck? Put more in savings.

These percentages aren’t set in stone – you can adjust them as your life and priorities change.

Q: I’m having trouble sticking to my budget. What should I do?

A: Don’t beat yourself up. Budgeting is a skill that takes practice, and it’s okay to slip up sometimes. The key is to understand why you’re going over budget.

Are you underestimating your expenses? Are you setting unrealistic spending limits? Once you figure out the problem, you can adjust your budget or your spending habits. And remember, a budget is a living thing that changes with you. As your lifestyle changes, so should your budget.

Q: Is there a budgeting app you would recommend?

A: Ah, technology, our ever-present helper! There are numerous budgeting apps out there, from Mint to You Need a Budget (YNAB) to EveryDollar. These apps can help you track your spending, save money, and pay off debt. My advice is to try out a few and see which one you find most user-friendly and useful.

Q: What are the best ways to budget personal finances? 

A: The best ways to budget personal finances include understanding your income and expenses, setting financial goals, selecting a budgeting method, tracking your money, and adjusting as needed.


  1. Values-Based Budget

    A values-based budget is all about aligning your spending with what matters most to you. It’s not about how much you’re spending, but where your money is going. For example, if supporting local Austin businesses is a priority for you, you might allocate a greater portion of your budget to buying local products or services. This method requires introspection and an understanding of what truly holds value for you.

  2. The Balanced Money Formula

    Popularized by Elizabeth Warren and Amelia Warren Tyagi, this method is also known as the 50/30/20 rule. It proposes allocating 50% of your monthly income to go to needs, 20% to savings, and 30% to wants. This is a relatively simple and highly effective method, ideal for those living in the fast-paced hub of Austin, who need a budgeting method that’s easy to follow yet impactful. While the Balanced Money Formula might work for many, your financial situation might call for a different approach. The 50/30/20 rule is flexible and can be tweaked to suit your unique needs. For example, if you have a high-interest student loan, you might allocate more to savings and debt repayment.

  3. 70/20/10 Budget

    Similar to the 50/30/20 rule but with different percentages for discretionary expenses, the 70/20/10 budget involves dividing your after-tax income into 70% for expenses, 20% for savings, and 10% for giving. This approach may appeal to philanthropically inclined Austinites who value contributing to their community.

  4. Sub-Savings Accounts Method

    This approach encourages you to set up different savings accounts for specific financial goals. For instance, you might have one account for a vacation fund and another for an emergency fund for emergencies. This is a strategic approach that can help those who have multiple financial objectives in mind.

  5. 80/20 Budget

    The 80/20 budget is a straightforward method where you save 20% of your income and the rest is for spending. This method requires setting up an automatic transfer emergency funds from your checking account to your savings account, ensuring that saving becomes a consistent habit.

  6. Cash-Only Budgeting

    Also known as envelope budgeting, this method involves using actual cash for all your spending categories. By physically dividing your money into different envelopes, you’re more aware of your spending. This method could be effective for those struggling with overspending on their debit card or credit cards.

  7. Zero-Based

    Budgeting strategy This budgeting method gives every dollar a job. In other words, your income minus expenses (which include savings) should equal zero. This approach requires you to allocate money for specific categories like entertainment, groceries, and health care, which can help Austin residents manage their finances with precision.


Budgeting is an essential part of managing your personal and business finances. It’s the first step to gaining control over your money and a means to achieving your financial goals.

The various budgeting methods mentioned above cater to different needs, preferences, and financial situations. It’s important to experiment with these methods and find the one that fits you best. Remember, consistency is key in budgeting.

The best method is the one you can stick with, enabling you to elevate your finances and lead a more financially secure life.

And remember, if you need more help with your business budget planning or personal budgeting, we at Nest Financial are always here for you. With over 40+ years of combined experience, we’re ready to help you take control of your business finances and steer your small business to success.


This article is brought to you by the wizard behind the scenes pulling levers with 23 years of experience, Dan Dillard, and his workshop of helpers including some handy hi-tech sourcing.

If you’re finding it challenging to stay on top of all the changes, connect with our financial planning professionals by scheduling a no-obligation call. At NEST Financial, we can help make crypto not quite so cryptic.

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DISCLAIMER: We are legally obligated to remind you that the information and opinions shared in this article are for educational purposes only and are not financial planning or investment advice. For guidance about your unique goals, drop us a line at info@nestfinancial.net

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