Budget Rule Calculator

The 50/30/20 budget rule is a simple and effective way to manage your monthly income by dividing it into three main categories: needs, wants, and savings.

How It Works

This budgeting method suggests allocating your after-tax income as follows:

• 50% for Essential Needs (housing, utilities, groceries, etc.)
• 30% for Personal Wants (entertainment, dining out, hobbies)
• 20% for Financial Goals (savings, investments, debt repayment)

Key Benefits

• Simple and easy to remember allocation
• Balanced approach to spending and saving
• Flexibility within categories
• Clear financial priorities

Best Practices

• Use your after-tax income for calculations
• Adjust percentages based on your circumstances
• Review and update your budget monthly
• Track expenses in each category
• Consider local cost of living adjustments