Question

If you used the 50-30-20 rule of budgeting, how much money would you be saving?

Answer 1

The basic rule of thumb is to divide your monthly after-tax income into three spending categories:
50% for needs, 30% for wants and 20% for savings or paying off debt.
- 50% of your after-tax income should cover your most necessary costs.
- 30% of your after-tax income can be used to cover your wants.
- 20% of your savings goals, or paying back any outstanding debts.