70/20/10 Budgeting

Unlocking Financial Success: The 70/20/10 Budgeting Method Explained

Making enough money but still living paycheck to paycheck? Don’t worry, you’re not alone. 

Times are tough. AND EXPENSIVE nowadays.

We know that things cost more now, living costs more now, even water costs more now! 


For years we boasted about how the 50/30/20 rule was the way to go but things have changed.

Unfamiliar with the 50/30/20 budget rule?  

It’s ok! It’s time we forgot about it anyways because it doesn’t make sense in our current economic situation! 

The idea is that that we should be bucketing our spending into three groups: 

Needs, Wants, and Savings. 

Previously, it was thought that 50% should be needs, 30% should be wants and 20% should be savings or investments. 

Well…. that doesn’t make a lot of sense now when housing USED to be cheaper or when food USED to be cheaper! 

70% of your money to “Needs” (Rent, Utilities, Groceries, Childcare, Insurance). 

20% for “Wants” (Dining out, Concerts, that big tv, that trip to the mountains). 

10% for the “Savings” category (Crushing debt, Emergency FundRetirement, College Funds). 

For example, if you make $2000/month:

$1400 would go into the “Needs” 

$400 would go into the “Wants”  

$200 would go into your “Savings” 

 Following the 70/20/10 rule is a simple money management method. 

Splitting up your paychecks into three buckets gives you freedom to spend how you like without worrying that you’ll derail your savings or debt payoff plans. 

We know that the word “BUDGET” may sound like “you can’t do this, or you can’t buy that” but with the 70/20/10 rule, it’s not restrictive for as long as you bucket your funds! 

4 tips to help you be successful with the 70/20/10 budget! 

  1. Use direct deposit to your advantage- Set up separate bank accounts for each of the three buckets and adjust your direct deposit to match the 70/20/10 rule
  2. Automate your bills- Set up your bank account to autopay bills right after you’re paid.
  3. Adjust your percentages- Want to save a bit more? Adjust your percentages to what best suits your situation 😊
  4. Split your 70% when budgeting with your spouse/partner – Depending on who earns what, is there an option for you to work on splitting the 70% to best suit your situation? Think about it and what needs to be paid when. How does your partner fit into your 70%?  

If you’d like to learn more about budgeting, check out this article from last year’s Financial Literacy Week which goes into more detail!