The 50/30/20 rule splits your after-tax income into three buckets: 50% needs, 30% wants, 20% savings and debt. It is the simplest budget to start with because there is almost nothing to set up.
The three buckets
Needs are rent, groceries, utilities, minimum debt payments. Wants are dining out, streaming, hobbies. The final 20% goes to savings and extra debt payoff.
When to adjust it
High cost-of-living? Your needs may run past 50% — trim wants first. The rule is a starting frame, not a law.
Go deeper
Prefer assigning every dollar? Read the complete budgeting guide and our zero-based budgeting walkthrough.