What is the 50/30/20 rule?
When creating a budget, it can be helpful to follow a guideline. By using the 50 | 30 | 20 rule as your guideline, you can create a budget that sets you up for success.
Designing Your Budget
The 50 | 30 | 20 Rule
50% must-haves
- Housing
- Transportation
- Insurance
- Groceries
30% wants
- ‘Fun’ money
- Dining out
- Shopping
- Hobbies
20% savings
- Paying down debt
- Savings account
- Emergency fund
Source: Elizabeth Warren & Maelia Warren Tyagi, “All Your Worth: The Ultimate Lifetime Money Plan”.
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