How to use the 50/30/20 budget calculator
- Enter your take-home pay, the amount that actually reaches your bank account after tax and deductions, and how often you are paid.
- See how much to spend each month on needs, wants and savings and debt repayment, with yearly totals.
- Try other popular splits, such as 70/20/10 or 60/20/20, or set your own percentages with Custom.
- Share or download your budget card, or copy the link to keep your numbers.
The 50/30/20 rule
The rule, popularised by Senator Elizabeth Warren in All Your Worth, splits after-tax income into three buckets: 50% for needs you must pay, 30% for wants that make life enjoyable, and 20% for your future, meaning savings, investments and paying down debt faster than the minimum. On a take-home income of 3,500 a month, that is 1,750 for needs, 1,050 for wants and 700 for savings.
It is a starting point, not a law. In expensive cities, rent alone can exceed half of take-home pay; a 60/20/20 or 70/20/10 split may be more realistic while you work towards 50/30/20. If you have high-interest debt, move money from wants to the third bucket until it is gone. Build an emergency fund of three to six months of needs before investing heavily. Paying the savings bucket first, by automatic transfer on payday, is the most reliable way to stick to it.
The calculator runs in your browser; your income is only stored in the link if you share it.
Is the 50/30/20 rule based on gross or net income?
Net (take-home) income: what you receive after tax, social security and other deductions.
Do minimum debt payments count as needs?
Yes. Minimum payments are needs; extra payments above the minimum belong in the savings and debt bucket.
What if my needs are more than 50%?
That is common. Use a 60/20/20 or 70/20/10 split for now and look for ways to reduce fixed costs over time.