It Pays to Do the Math In the Budget Game

Keep in mind that these percentages and line items are just guidelines. They help you establish a barometer. The ranges and categories will depend on a lot of factors, including whether you're married, have children or live in a high-cost area. If 60 percent of your income is spent on housing, transportation and food, you've got to make the remaining 40 percent work by refiguring the percentages.

"Everyone is different, and everyone really does have different percentages," Warner said.

During a recent online discussion, dozens of readers asked questions that indicated to me that they hadn't figured out what percentage of their income should be spent on lifestyle expenses. Sure, some people say they budget. But then they fret and fuss and get off track because they don't have a baseline.

I know that "budget" is a bad word for many people. They hate to do it. It feels constraining. Or of those who do budget, many arbitrarily decide what they will spend.

If you had a barometer, perhaps budgeting would be easier. For example, I received this question from a reader participating in an online discussion. She wrote: "I've been married for two years and my husband and I like to shop. It's horrible. I've tried to save and it's not working. I look at how little we have and yet we still spend a lot. I can't figure it out."

I can. They don't have a plan.

This question from another reader also shows she isn't budgeting. "How do you keep from raiding your rainy day fund? I am so guilty of this (especially when trips roll around)."

You keep from raiding your rainy day fund for anything other than truly unexpected emergency by budgeting for the things that you can plan for. A vacation is not something that is unexpected. You can plan for it.

If you like to have nice and expensive clothes, that's okay. What's not okay is shopping without a budget limit.

Let's say you net about $50,000 a year. The MMI guidelines allow for about 4 percent of your budget for clothing, or $2,000 a year. Now you can split that up and buy dozens of items or splurge on one complete high-fashion designer outfit. It's your choice. But once you hit that $2,000 mark, stop shopping. If halfway through the year you're off track with, say, health expenses, then you may have to cut your clothing allowance to 2 percent or even 1 percent to balance your budget.

Using a percentage method to budget helps you remember how much you can spend in any one-expense category and overall. If you budget this way, you will have financial freedom and peace of mind.

· On the air: Michelle Singletary appears on Washington Post Radio (107.7 FM, 1500 AM) at 6:20 a.m. Thursdays. She also discusses personal finance Tuesdays on NPR's "Day to Day" program and online athttp://www.npr.org.

· By mail: Readers can write to her at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071.

· By e-mail:singletarym@washpost.com.

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