Budget Calculator (50/30/20 Rule)
Easily split your income into needs, wants, and savings. Get instant insights and take control of your money.
How It Works
Take control of your finances with our simple budget calculator. Just enter your monthly income, and we'll instantly show you how to allocate your money using the proven 50/30/20 budgeting method.
The 50/30/20 rule divides your after-tax income into three categories: 50% for needs (rent, groceries, utilities), 30% for wants (entertainment, dining out), and 20% for savings and debt repayment.
List your regular expenses to get a more accurate budget breakdown (optional).
Adjust the 50/30/20 rule to fit your goals.
Enter your desired percentages for each category. They should total 100%.
Essential expenses
Discretionary spending
Future & investments
Understanding the 50/30/20 Rule
Created by Senator Elizabeth Warren, the 50/30/20 rule is one of the most popular and effective budgeting strategies for building financial stability and achieving your money goals.
50% - Needs
Essential expenses you can't avoid: housing, utilities, groceries, transportation, minimum debt payments, insurance, and healthcare. These are your non-negotiable costs.
30% - Wants
Lifestyle choices and discretionary spending: dining out, entertainment, hobbies, subscriptions, shopping, and travel. These enhance your quality of life but aren't essential.
20% - Savings & Debt
Emergency fund, retirement contributions, extra debt payments, and long-term savings goals. This secures your financial future and provides peace of mind.
Why This Rule Works
- ✓Simple to follow: Just three categories make budgeting less overwhelming
- ✓Balanced approach: Covers essentials while allowing for enjoyment and future planning
- ✓Flexible framework: Can be adjusted based on your income level and life circumstances
- ✓Builds good habits: Automatically prioritizes saving and debt reduction
Remember, the 50/30/20 rule is a starting point. If your needs exceed 50% of your income, focus on reducing expenses or increasing income. The key is finding a sustainable balance that works for your unique financial situation.
Frequently Asked Questions
Get answers to common budgeting questions