The 50/30/20 rule

The 50/30/20 rule is a simple way to split your monthly net income into three parts:

Share	For	Examples
50%	Needs	rent or mortgage, utilities, groceries, commuting, insurance
30%	Wants	eating out, travel, shopping, hobbies, entertainment subscriptions
20%	Savings and debt	emergency fund, investments, extra payments to clear a debt

An example

With a net salary of €1,800 a month:

• €900 for needs;
• €540 for wants;
• €360 to save or put toward debt.

How to apply it

1. Start from net income — what actually reaches your account.
2. Sort the last two or three months of spending into the three shares. In CaliMoney it's enough that your categories make it obvious (for example "Housing", "Groceries", "Leisure"); subcategories help group them.
3. Compare your real percentages with 50/30/20. The gap tells you where to act.
4. Turn the shares into caps: a monthly budget on your "wants" categories is the most direct way to hold the 30%.
5. Save first: move the 20% at the start of the month, not whatever is left at the end. With accounts you can record it as a transfer to a savings account.

When to adapt it

The rule is a starting point, not an obligation.

• High rent: in many cities needs exceed 50%. A 60/20/20 split is still a good result.
• Irregular income: work the shares out on your lowest month of the last six, not the average.
• Expensive debt: while you pay high interest, the 20% does more paying the debt down.

Try it with CaliMoney

CaliMoney shows what you spend per category month by month, with budgets and alerts — free, and offline too. Create an account and measure your real percentages.