The Personal Economic Process

1. The budgeting process consists of figuring out how much needs to be alloted from one's monthly income to various expenses. How much is alloted is a function of what kind of lifestyle one aspires to acheive, as well as ones monthly income. An example of a monthly budget is as follows: $400 for groceries, $200 for dinining out, $100 for mortgage or rent, $300 for utilitites, $200 for house mainenance, $300 for a car payment, $250 for gas and oil, $50 for car …

…like to micro-manage everything in their portfolio. In my own personal portfolio, I would have a large amount invested in high risk areas, such as junk bonds, high growth stocks, and even some real estate and collectables. I would put 60% of my money in the aforementioned areas. The next 20% would be safely put into CD's and treasury bonds, and the final 20% would be in a savings account for quick access in case of an emergency.