50/30/20 Budget Calculator
The 50/30/20 rule is one of the simplest budgeting methods. Enter your income to see exactly how much you should spend on needs, wants, and savings each month.
Monthly After-Tax Income
Enter your total monthly take-home pay (after taxes and deductions).
Your 50/30/20 Breakdown
Housing, utilities, groceries, transportation, insurance, minimum debt payments
Entertainment, dining out, hobbies, subscriptions, travel, shopping
Emergency fund, retirement savings, investments, extra debt payments
Weekly & Daily Limits
Needs (weekly)
$0
$0/day
Wants (weekly)
$0
$0/day
Savings (weekly)
$0
$0/day
Annual Projection
If you follow this budget for a year, here's what you'll save:
Yearly Savings (20%)
$0
That's 0 months of expenses in reserve!
What Is the 50/30/20 Rule?
The 50/30/20 budget rule was popularized by Senator Elizabeth Warren in her book "All Your Worth: The Ultimate Lifetime Money Plan." It's a simple framework for managing your after-tax income:
Needs
Essential expenses you can't avoid: housing (rent/mortgage), utilities, groceries, transportation, insurance, minimum debt payments. These are things you need to survive and function.
Wants
Non-essential spending that improves quality of life: dining out, entertainment, hobbies, streaming subscriptions, vacations, shopping for non-necessities. Nice to have, but you could live without them.
Savings & Debt
Building your financial future: emergency fund, retirement contributions (401k, IRA), investments, and extra payments toward debt beyond minimums. This is how you build wealth.
Making the 50/30/20 Rule Work for You
What if I can't hit 50% on needs?
High housing costs in some areas make 50% unrealistic. Adjust to 60/20/20 or 55/25/20 if needed—the key is having a framework, not following exact numbers.
Where does debt fit?
Minimum payments are "needs." Extra payments toward debt come from the 20% savings category. Prioritize high-interest debt before investing.
Is this rule for everyone?
It works best for middle-income earners. If you're paying off debt aggressively or have very high/low income, you may need different ratios.
How do I track this?
Use a budgeting app like BUDGT to track daily spending. Categorize expenses as needs or wants, and automate your savings transfers.
Frequently Asked Questions
What income should I use for the 50/30/20 calculation?
Use your after-tax (net) income—the amount that actually hits your bank account. This includes your salary after taxes, plus any side income. If you have irregular income, use an average of the last 3-6 months.
Is a gym membership a need or a want?
Generally, a gym membership is a "want" because you could exercise for free (walking, home workouts). However, if your doctor prescribes exercise for a health condition, you might argue it's a need. The gray areas are personal—be honest with yourself.
What's the difference between 50/30/20 and zero-based budgeting?
The 50/30/20 rule gives you broad spending categories. Zero-based budgeting assigns every dollar to a specific purpose (e.g., $200 for groceries, $50 for gas). 50/30/20 is simpler but less detailed. Many people start with 50/30/20 and get more specific as needed.
Should I include retirement contributions in the 20%?
Yes! If your employer deducts 401(k) contributions before you get paid, add those back when calculating your 20%. For example, if you earn $5,000 after tax and $500 goes to 401(k) pre-tax, your savings goal would be 20% of $5,500 = $1,100 (including that $500 already saved).
What if my needs are more than 50% of my income?
This is common, especially in high cost-of-living areas. Options: 1) Reduce needs (roommate, cheaper car, refinance loans), 2) Increase income (side gig, ask for raise), 3) Accept a modified ratio like 60/20/20. The goal is progress, not perfection.
Ready to track your 50/30/20 budget?
BUDGT helps you see your daily spending limit and stay on track.
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