Enter your income and actual expenses to see where you stand against the classic budgeting rule.
Popularized by Senator Elizabeth Warren in her book All Your Worth, the 50/30/20 rule is a simple framework for balancing your spending: 50% of after-tax income on needs, 30% on wants, and 20% on savings and debt repayment.
These are non-negotiable expenses: rent, groceries, utilities, minimum debt payments, health insurance, transportation to work. If you lost your job tomorrow, these are the bills you'd still have to pay.
Everything that makes life enjoyable but isn't essential: streaming services, dining out, gym membership, vacations, new clothes, hobbies. You could live without these. Most people have their wants category way too high.
Emergency fund contributions, retirement accounts (beyond 401k), investment accounts, and extra debt payments above minimums. This 20% is what builds long-term financial security.
In high cost-of-living cities, housing alone might take 40%+ of income — which forces you to compress wants or savings. The rule is a starting point, not a law. If you're in an expensive city, try 60/20/20 until you can move or increase income. The key is having explicit targets, not perfection.
Apply the rule to your take-home pay, not your gross salary. Your 401k and health insurance premiums are already out before you see the money — they effectively count toward the "savings" bucket without needing to be tracked here.