'I tried that 50/30/20 budget rule everyone talks about. Here's what happened.'

Thanks to our brand partner, RACQ Bank

There are days when just hearing the word "budget" sends a chill down my spine.

I'm partial to a budgeting technique I like to think of as the "blind Apple Pay", which involves closing my eyes and sending a prayer to the heavens (or my bank, whatever works) before swiping my phone against an EFTPOS machine.

This is an absolutely foolproof technique — until, of course, I run out of money. The blind Apple Pay method is not a sustainable long-term budgeting technique, and I am well aware of this fact.

So, I thought I'd give the 50/30/20 budget rule a go for two weeks and see what happened. A structured approach to managing my money was certainly going to be a change, but I was hoping it might make me feel more in control of things. Besides, what did I have to lose?

Certainly not my self-respect, which I abandoned at my local café last week when my card was declined trying to pay for a coffee I was already part-way through drinking. Onwards!

The preparation

The crux of the 50/30/20 budgeting rule is, as the name would suggest, fairly simple. You take whatever you're earning and split it into buckets, so you're allocating 50 per cent to your needs, 30 per cent to your wants and 20 per cent to your savings.

The easiest way to do this is to physically split your money into different accounts. RACQ Bank, for example, has a suite of everyday banking products that can help make the breakdown easy, so you can siphon off your savings immediately and move your everyday spending and money for bills into transaction accounts.

For me, visibility over my funds is the number one factor in making — and sticking to — a budget, so a bank like Queensland's RACQ Bank, which helps with the visualisation of the budget "buckets", is critical.

It was when I came to doing the calculations that I hit the first hurdle with the 50/30/20 rule.

I'm going to be real with you. Living with two kids and a mortgage in inner Sydney, spending only 50 per cent of my income on "needs" is just not sustainable. Even when I took my higher-earning husband's salary into account and used the 50/30/20 method across our whole combined income, between our mortgage, strata rates and daycare, we're spending significantly more than 50 per cent of what we earn.

There's nothing I could do about the costs of our family's "needs" this month (except sell up and move back in with my mum, which believe me, I have considered). What I did instead was split the remainder of our income (minus the "needs" portion) in a 60/40 split, to mimic the "30/20" part of the budgeting rule. What that left us with was less disposable income ("wants") and more savings than we were used to.

On paper, I was stoked with this outcome. We've been talking about reassessing how much we've been saving for a while, and given we have a balloon payment on our car lease coming up, we really need to be putting extra money aside.

The execution

Once I had my budget drawn up, it was time to spend. Or, erm, not spend, as the case turned out to be.

If I haven't made this clear, I have not been thinking very much on a day-to-day basis about how much I spend. Unfortunately, the answer to this question is: a fair bit. In my effort to stick to the 30 per cent "wants" spend, I calculated how much I could spend per week. It was less than I am used to, and honestly, it challenged me.

I have long taken the attitude that, as a person with a job, I should be able to buy a takeaway coffee whenever I please, and while this isn't necessarily untrue, it does mean I can't also buy my lunch. Or also buy a new phone case. Or also go out for wine on a Saturday afternoon.

The upside? At the end of the trial, we had significantly more in savings than we've managed to achieve since the serious daycare bills started rolling in. As a person whose dominant emotion around money is "panic", it was actually really cool to feel proud of myself at the end of the fortnight.

What I'd do again

Understanding that this is absolutely budgeting 101, knowing exactly how much I had in each "bucket" for the month — and not giving myself the option to exceed it — really did make a difference to how much I spent.

I found myself doing a lot less blind Apple Paying — a habit I swear from here on to break — and a lot more checking, and re-checking, my bank balance.

Having the right bank set-up was a game changer when it came to this aspect, and one I'll definitely carry through, even if I end up toggling with the "percentage" breakdown of the 50/30/20 down the track.

I feel more in control of things, and that's a surprising — but exciting — place to find myself when it comes to finances.

Want to learn more? Visit RACQ Bank's website.

Banking and loan products issued by Members Banking Group Limited ABN 83 087 651 054 AFSL/Australian credit licence 241195 trading as RACQ Bank. Terms, conditions, fees, charges and lending policies apply. This is general advice only and may not be right for you. This information does not take your personal objectives, circumstances or needs into account. Read the disclosure documents for your selected product or service, including the Financial Services Guide and the Terms and Conditions, and consider if appropriate for you before deciding.

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Thanks to our partner RACQ Bank, proudly trusted by Queenslanders for their banking needs. Whether it's your new savings account, a home loan, or planning for your future, RACQ Bank is here with all the products you need and genuine support to help you feel confident about your money.