What is the 50/30/20 rule?

When creating a budget, it can be helpful to follow a guideline. By using the 5030 / 20 rule as your guideline, you can create a budget that sets you up for success. 

Designing Your Budget

The 5030 / 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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