Manage Your Budget With The Money Stacks System

Managing money has never been one of my strong points, but after viewing a YouTube video by Jennifer from, I was really taken back by how easy it was to manage your budget with this Money Stacks System.

The Money Stacks System is essentially splitting your budget into six different areas using percentages of your income. Allocating money to essentials, financial independence, long term savings, fun, growth and giving allows you to cover all areas with your budget.

First things first though, if you haven’t yet established a budget for your family, create one as a baseline for this method.

Create a budget

Add up all of your income, including:

  • Your income
  • Your partners income
  • Any state benefits you receive
  • An average income from side hustles (better yet, set aside some profits to pay yourself with the following month, like a wage. Then you will know a definite amount to expect each month.)
  • Any other payments, including maintenance / support payments.

Once you have totalled your monthly income, begin listing all of your outgoings. This will include every direct debit payment to leave your bank account every month. Include the essentials like housing, utility bills, car payments, subscriptions, gym memberships, and food.

Every regular payment you make on a monthly basis should be in this list. It will allow to have a solid foundation of your money habits and allow you to really see where your money is going. It allows you to identify where extra cash may be slipping away every month and a chance to rein in your habits.


As you look at the Money Stacks System, you will begin to identify which category each of your payments fall into.

The Money Stacks System

Stack 1: Essentials – 50-60%

The first pile, or stack, is the Essentials stack. This includes taking 50-60% of your budget to pay for anything that is an essential payment. These payments should cover your rent or mortgage payments, bills, food and any minimum debt payments. Debts could be categorised as car payments, credit card bills and personal loan payments.

This stack is the biggest portion of your income that covers all of your living expenses. It is anything that keeps you safe, sheltered, warm and fed.

This does not include luxuries and entertainment payments really anything other than the absolute bare bones of your survival needs. Everything else is considered optional.

Stack 2: Financial Independence  – 10%

I feel that this is where this budgets is a world away from other budgeting methods.

Jennifer is very focused on financial freedom (as am I – which is why I love her!) She discusses the importance of investing roughly 10% of your income into your financial independence.

Our generation will likely see most people still working into their 70’s with little to show for their life working every day due to them unable or unwilling to invest in their long term future. I have decided that I do not want to to be one of those people.

By investing 10% of your wages into something like a Stocks ad Shares ISA or similar, you are in a way saving money for the future that will also generate a passive stream of income. Every month, you will receive a Compound Interest payment as a percentage of your savings invested.

For example, if you save £150 per month for twenty years, at an average rate of 10% annual interest, your total deposits saved will amount to £36,000. However, the total interest accumulated in that time through compound interest is almost £79,000, bringing your total balance to £115,000!

You could live ust from the annual interest payments (by year twenty, this is almost £11,000 – roughly £900 per month) Obviously this comes with some risk, ans there are other methods of investing into your financial independence, like your pensions.

Putting extra money into a private pension can create some more safety and stability for the future ahead, It can mean you retire at an earlier age, allowing you to be time rich a lot sooner! I already have a workplace pension where my employer removes a percentage of my wages and matches it (and then some!) And to me this is enough for the time being with our current income and commitments.

Disclaimer: This post may contain referral links on which I make a very small commission if you decide to make a purchase. This is at no extra cost to you and I would only recommend products that I would buy, or have bought, myself.

Stack 3: Long Term Savings – 10%

This stack is for funding the items or experiences that are more costly, such as holidays and new cars.

Put away around 10% or your total income into this stack to allow you to reach those goals quicker. Paying cash will give you a much bigger sense of achievement than putting it on credit!

Stack 4: Fun / Guilt-Free – 10%

This is your fun money to do with whatever you please and not feel a shred of guilt. Once you have the other stacks and systems in place where you know other responsibilities are being taken care of, you can allow yourself some cash to be a tiny bit reckless.

Perhaps take your family out to a meal, or go to the cinema. Join the gym or buy those pair of shoes that you need without it playing on your conscience. We need a little bit of fun money to make us feel more human. If we deny ourselves all pleasures you are more likely to resent your budget and not stick to it.

Stack 5: Growth and Education – 5-10%

Personal growth should not dwindle when you are on a budget. Growing and learning is an important part of personal development and you should try to account 5-10% of your monthly income toward this. Examples of this could include:

  • An Online Course
  • Night School
  • Degree / Distance Learning
  • Starting a Business
  • Attending Seminars

It’s easy for debt to paralyse you and stop you from looking forward. You can only see the mountain of bills blocking your view, or a minimal budget allows to believe you are simply surviving – how depressing! Allow yourself to develop a skill or learn a subject that can actually make you more money, increasing your total budget.

Stack 6: Giving – 5-10%

The law of attraction states that what you put out into the universe is what you receive. Positive vibes bring positive vibes, and negative vibes bring a whole lot of unhappiness!

I am a large believer of this and try to give when I can. It is difficult to think about others in less fortunate situations than yourself. But when we are lucky enough to have all of the essentials we need keeping us alive and safe, enough food for a warm family meal, and enough that we may enjoy life beyond survival, we should think about giving back to those who may not have the same opportunities and luxuries in life.

Examples of giving could include:

  • Shopping for groceries to donate at a local food bank
  • Buying items for the homeless
  • Donating money to a charity of your choice
  • Taking part in a sponsored event for charity
  • Help a family you know

I hope this post has given you some motivation into alternative budgeting methods. This is a more flexible way of managing money, and allows you to grow towards financial freedom and a quicker pace.

If you liked Jennifer’s Money Stacks System, check out her website.

She has also written a book which I have recently sped through in two nights. It effectively teaches you about the mindset of money and how to begin your financial freedom journey. It’s a great read!

Will you be adopting this method of budgeting? Let me know in the comments!

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