To determine the maximum percentage of net spendable income that should be set aside for transportation, let’s analyze the options given:
A. 15%
B. 25%
C. 30%
D. 20%
When creating a budget, it's crucial to allocate portions of your net spendable income (the income remaining after taxes and mandatory deductions) to various essential categories, including transportation. Financial advisors often provide guidance on how much you should ideally spend in each category to ensure your budget is balanced and you're not overspending in any one area.
According to well-established budgeting guidelines, a reasonable amount to allocate for transportation expenses—such as car payments, gas, maintenance, public transit fares—shouldn't exceed a certain percentage of your net income.
The correct answer, which aligns with these guidelines, is:
D. 20%
This means that you should ideally set aside no more than 20% of your net spendable income for transportation expenses. This ensures that you have sufficient funds available for other necessities and financial goals, such as housing, food, savings, and entertainment.
