50/30/20

Front

What is the 50/30/20 budget rule?

Back

A budgeting guideline that suggests allocating 50% of income to Needs, 30% to Wants, and 20% to Savings.

Front

What does the 50% in the 50/30/20 budget rule represent?

Back

Needs, which are essential expenses like housing, food, and utilities.

Front

What does the 30% in the 50/30/20 budget rule represent?

Back

Wants, which are non-essential expenses like entertainment, dining out, and hobbies.

Front

What does the 20% in the 50/30/20 budget rule represent?

Back

Savings, which includes savings accounts, investments, and debt repayment.

Front

Give an example of a 'Need' in the 50/30/20 budget rule.

Back

Food, housing, healthcare.

Front

Give an example of a 'Want' in the 50/30/20 budget rule.

Back

Dining out, vacations, luxury items.

Front

What is a common expense categorized as a 'Bill'?

Back

Electricity bill, water bill, rent.

Front

How do you calculate the amount for 'Wants' if you have $2000 left after taxes?

Back

Multiply $2000 by 30% (0.30) to get $600.

Front

If you earn $3000, how much should you allocate to Savings according to the 50/30/20 rule?

Back

$600 (20% of $3000).

Front

What is the importance of budgeting?

Back

Budgeting helps manage finances, prioritize spending, and save for future goals.