Budgeting & Personal Finance
50/30/20 Rule
Definition
A simplified budgeting framework that allocates after-tax income into three categories: 50% for needs (rent, utilities, groceries, insurance), 30% for wants (dining out, entertainment, subscriptions), and 20% for savings and debt repayment. Popularized by Senator Elizabeth Warren in her book "All Your Worth," this rule provides a quick baseline for evaluating whether your spending is balanced. It works best for people with stable income and is a good starting point before creating a more detailed budget.
Related Templates
These SheetCraft templates use or relate to 50/30/20 Rule:
- Budget by Paycheck, Gig Workers Edition, Budget template designed for irregular income, allocate every payment as it arrives, in priority order.