How it works
The 50/30/20 rule (popularized by Senator Elizabeth Warren) is the simplest budget that works:
- 50% Needs — rent, groceries, utilities, transport, minimum debt payments.
- 30% Wants — dining out, hobbies, subscriptions. Guilt-free, because it's budgeted.
- 20% Future you — savings, investing, extra debt payments.
High-cost city? Flip it to 60/20/20. The percentages are training wheels — the habit is the point.
Frequently asked questions
What if 50% doesn't cover my needs?
Common in expensive cities. Try 60/20/20, or treat it as a target while cutting the biggest need (usually housing).
Where do debt payments go?
Minimums are Needs; anything extra is Savings (paying down debt IS saving, at your APR rate).
How do I actually stick to it?
Automate: savings transfer on payday, separate 'wants' account. Willpower fails; systems don't.
Disclaimer: This calculator provides estimates for educational purposes only and is not financial, tax, or legal advice. Consult a qualified professional before making financial decisions.