Women of Medicine

Simple Budget

Know where your money is going – and make a plan for where you want it to go. The 50/30/20 budget breaks down your monthly after-tax income into 50% needs, 30% wants, and 20% savings and debt repayment.

How to use the 50/30/20 budget:

    1. Monthly after-tax income – this is the number after taxes have been deducted from your gross income. The 50/30/20 rule is a popular method used to budget your income towards 50% needs, 30% wants, and 20% for savings and debt repayment.
    2. 50% needs – this means fixed expenses for necessities, which may include: housing, food, transportation, utilities, insurance, minimum debt payments, childcare, etc.
    3. 30% wants – this could include: eating out, travel expenses, shopping, concert tickets, etc. 
    4. 20% savings and debt – this is the bucket where you put away money for the future such as: an emergency fund, retirement accounts, and paying off consumer debt, etc.