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Experts on Budgeting Advice: Learn from the Best

One of the strangest things about how we handle money is that outside of seeking expert advice on investments and taxes, many of us do not seek help when it comes to budgeting. And while many of us manage just fine, that doesn’t mean we couldn't stand to learn a thing or two about effectively managing the way we spend our money.

So, what’s the best budgeting advice for the average American household? Here are 5 of the most popular and simple budgeting strategies that have stood the test of time with long-term proven results.

Elizabeth Warren: The 50-30-20 Rule

While Elizabeth Warren is best known as a senator from Massachusetts, for many years she was an expert in the field of economics and a tenured professor. She also wrote twelve books on economics, of which “All You’re Worth: The Ultimate Lifetime Money Plan” is by far the most popular when it comes to setting yourself on a lifelong path to prosperity.

In this best-selling book she lays out what she refers to as the 50-30-20 rule for households: basically, a financially healthy household should spend 50% of their income on essential month-to-month expenses like housing, utilities, food and clothing, 30% on non-essentials like entertainment, travel and fun, and the remaining 20% goes to savings. This basic budgeting plan has provided a solid financial foundation for millions of households for well over a decade.

Suze Orman: Cut Your Spending by 10%

While you might not know her by name, you’ve no doubt seen a financial advisor and author Suze Orman at some point when flipping through the channels. Not only was she once a financial advisor for Merrill Lynch and the author of 10 best-selling books on personal finance, but she also gained an army of loyal viewers on The Suze Orman Show, which premiered on CNBC in 2002.

Known for her no-nonsense approach to all things financial, her favorite budgeting tip is also her simplest: cut your expenses by 10%. Cutting your spending by 10% a month will slowly but steadily add up over time, especially if you invest that money and let it grow over time. From month to month you won’t feel the financial pinch, but in the long-term, you’ll definitely appreciate the benefits you’ll reap.

Mark Cuban: Get Rid of Your Debt

If there’s such a thing as a celebrity investor, Mark Cuban is the walking embodiment of it. He’s one of the panel investors on the TV show Shark Tank, but of all the “sharks” he is by far the most successful. He’s a self-made multi-billionaire and offers one simple yet potent piece of advice when it comes to budgeting: get rid of your debt.

Not only is it the responsible decision to pay off loans like credit cards and installment loans, the interest rate on debt of almost any kind will negate the return on almost any type of investment you make. In Mark Cuban’s estimation, it simply isn’t worth saving money until your debt is gone.