Budget Calculator (50/30/20 Rule)
Split your take-home pay into needs, wants and savings with the 50/30/20 rule.
Good to know. The 20% for savings works best when it leaves your account the day you’re paid, before the 30% notices.
Not financial advice. Uses only the numbers and rates you enter — no live data.
How it works
In plain words
Take your monthly take-home pay and split it by the three percentages. Whatever needs and wants don’t use goes to savings and paying off debt faster.
The formula
needs = pay × 50 % wants = pay × 30 % savings = pay × (100 % − needs − wants)
Worked example
On 4,000 a month: 2,000.00 for needs, 1,200 for wants and 800 for savings, which is 9,600 a year.
Sources
- Elizabeth Warren and Amelia Warren Tyagi, All Your Worth: The Ultimate Lifetime Money Plan, 2005 The 50/30/20 balanced money formula.
Sources checked September 30, 2026. 3 automated tests check its answers on every change.
About the budget calculator (50/30/20 rule)
The 50/30/20 rule is a simple way to budget without tracking every coffee. It was popularised by Elizabeth Warren and Amelia Warren Tyagi in their book All Your Worth. Split your take-home pay into three buckets: 50% for needs, 30% for wants and 20% for savings.
Needs are what you must pay whatever happens: rent or mortgage, utilities, groceries, insurance, transport to work and minimum loan payments. Wants are everything that makes life nicer but could be cut: eating out, streaming, holidays, new clothes you don’t strictly need. Savings include an emergency fund, retirement contributions and any payments above the minimum on debts.
The percentages are a starting point, not a law. In expensive cities, housing alone can take half of take-home pay, so 60/20/20 or even 70/20/10 is more realistic. If you have high-interest debt, moving money from wants to savings and debt repayment pays off quickly. Adjust the needs and wants fields; savings is what is left.
Use take-home pay, not your salary: taxes and payroll deductions are already gone before the budget starts. If your income varies, budget on a low month and treat anything above it as extra savings. The paycheck and take-home pay calculators can work out your monthly take-home figure.
Questions people ask
What is the 50/30/20 rule?
A budget that spends 50% of take-home pay on needs, 30% on wants and puts 20% into savings and debt repayment.
How much should I save each month?
The rule suggests 20% of take-home pay. On 4,000 a month, that is 800.
What if my needs are more than 50%?
That is common where housing is expensive. Raise the needs percentage and cut wants first, so savings stay as close to 20% as you can.
Should the budget use gross or net pay?
Net, take-home pay: what actually arrives in your account.