This is what most blogs on the topic say to do since making minimum payments on debts and financial obligations like child support really is a necessity, since you’d face fines, wage garnishments, ruined credit, suspended licenses, and passports, in some cases, etc. if you don’t pay your debts. A certain amount of clothing and personal care is also in necessities (job interview clothes + basic clothing) – extra just for fun clothing and fancy personal care items like bath bombs, expensive skincare, etc. go in discretionary spending. Basically necessities are how you’d spend your money if you were unemployed and had to only purchase the bare minimum to get by. Incidentally, your monthly necessities total is what you should base your emergency fund off of (emergency savings = 3-6 times your necessities budget or up to 1 year if you are self-employed or a single earner in a precarious job).

If you don’t make enough money to include your minimum debt payments, an affordable basic capsule collection of clothes and basic personal care items (toothpaste, deodorant, affordable shampoo, conditioner, body wash, lotion, and a basic skincare routine) in necessities, then lower your discretionary spending amount – for example 60% necessities, 20% spending, 20% saving/investing/extra debt payments. You might also lower spending for a time in order to save for a house or other large financial goals, up to 30% or more towards saving/investing.