UAE: Better ways to budget your income after paying routine expenses

UAE: Better ways to budget your income after paying routine expenses

Dubai: Dubai-based chartered accountant Viren Bhatia is naturally wired to be cost-conscious due to his profession. With the emphasis on savings, a significant portion of his salary he puts aside for the rainy day and growing his family wealth. "Despite being a chartered accountant, who believes in planning and budgeting to control costs in their organisations, I do not prepare a budget for my household expenses. However, that does not mean that I am not conscious of my regular and discretionary expenditure." Disposable income represents the amount of money you have for spending and saving after you pay your income taxes, if any. Discretionary income is the money that an individual or a family has to invest, save, or spend after taxes and necessities are paid. Discretionary income comes from your disposable income. Bhatia suggested that having funds allocated for all necessary expenses is a must. He has made provisions for items of essential expenditure that are rent, utilities, food, children's education, life and critical illness insurance premiums, mortgage payments and remittance to his parents. "It usually takes on 70 per cent of my annual income. Once the above are taken care of, a portion of the balance goes into