What is the 60/30/10 rule?

The 60/30/10 rule budget uses 3 categories of spending to manage your finances. The specific percentages are used to determine what portion of your current income will be applied to which category. First, 60% of your after-tax income will be dedicated to savings, investing, or debt payoff.

What is the 60/30/10 budgeting rule?

The 60/30/10 budgeting rule prioritizes financial goals over spending. Because of the large percentage allocated to savings or debt payoff, it’s not a budgeting style that is suited to everyone’s circumstances. For example, if you are just starting your first budget, I don’t recommend this method for you.

What is 60/30/10 & how does it work?

When using the 60/30/10 you’ll allocate 60% of your monthly income towards essential expenses, such as gas, utilities, groceries and rent. Thirty percent of your income will go towards discretionary spending, such as shopping or dining out, and the final 10% is either put in savings or used to pay off high-interest debt.