60-30-10 rule budget
What is the 60-30-10 rule budget?
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Have you ever wondered what finance would be like without a budget? Well, there’ll be no finance. When we talk of budget, we talk of numbers. Today, let’s introduce you to another number: the 60-30-10 rule budget.

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WHAT IS THE 60-30-10 RULE?

It is a budget rules that says you should save 60% of your income, spend 30% to care for your needs, and use 10% to take care of your wants.

This is a budget system that divides your income into percentages. Each number represents a percentage. 

It says they should split your income into: 

60% allocated to savings investments, 

30% should go to your needs and you keep 

10% for your wants.

It sounds simple, right? Well, not so simple.Before we  proceed, have you ever wondered why humans love numbers? It is because numbers sell.

We all love numbers. 

QUOTE: “Numbers don’t lie. Women lie, men lie, but numbers don’t lie.”

Max Holloway

In a previous article, we discussed the 50-30-20 rule. You can read that article here. In this article, we’ll discuss the 60-30-10 budget rule. 

The 60-30-10 rule budget

But is it realistic to save 60% of your income?

Before we proceed, let’s point this out: Any budget saving rule is what it is… a rule. Whether it is the 60-30-10 rule. Or the 50-30-20 rule. Or the 70-20-10 or the 40-30-20-10, or the 80-….

Alright! Alright!! Can we just tell these guys to unify the whole budget percentage rule of a thing?

Rules are flexible, carry low consequences and are usually personal in nature. So, no dogmatic favor here. If you believe this rule is for you, apply it.

With this said, let’s dive in.


The 60-30-10 rule in effect says that in life, we only need money for 3 things:

  • Investment
  • Needs, and 
  • Wants

Allocate 60% of your income to Savings and Investment. Keep 30% to cater to your needs, and use the remaining 10% to satisfy your desires, that is, your wants.


These include savings, real estate, stock and bonds.


These are things you need to survive. Such as, housing, food, clothing. Medical care, education, transportation, and things like these.


These are things we need to make life more enjoyable. We can live without them, but they add color to our lives. Here we can include going for vacation, recreation, entertainment. Going to the cinema with friends and family. And the list goes on.

While the 50-30-20 rule is an easier and balanced budgeting rule. Especially for those who are new to budgeting. The 60-30-10 rule is for people who love frugal living. 

One word of caution: Please note that this rule is not for everyone. If you’re new to budgeting, this might not be your best option.

For clarity on how this rule can and cannot be used, let’s imagine a family where dad and mom works. Dad takes care of feeding,  children’s education, house rents, medical bills and feeding. 

Mum, on the other hand, also works full time (or part time, maybe). But since the basic family needs are being taken care of by the husband, she has less compulsory expenses to care for.

In this “case study” it is easier for the woman than the man to apply the 60-30-10 rule. And in fact, she should. Now she can save 60% of her income. Use 30% to assist the family. And she has a whooping 10% for pleasure and fun. 

Is 10% too small for caring for wants? Well, if the husband applies the 50-30-20 rule, I guess the family will have more than enough to care for their wants.

If you have read up to this point. It means that I have successfully convinced you. 

This been said, let’s discuss the benefits of following the 60-30-10 budget rule. 


60 30 10 rule savings

1. The 60-30-10 rule is a simple and effective way to save up fast and large:

Do you have a project, little income and less time to raise funds? Then, this rule is for you.

It is an aggressive way to save up. If you’re new to budgeting, this might not be your best option. Try this instead.

This is the perfect alternative to borrowing. Have you ever sought a loan? Not because you can not raise the needed funds. But because the time you have is just too short. If that is true in your case, why not try this out. It comes with some sacrifice and self discipline, but it gets the job done.

For example, imagine you needed to raise $10,000 with a monthly income of $5,000. Now assume you have nothing in your savings account. With this budget techniques, you’ll be able to save:

60% of your income for this future project.

60/100 * 5,000 = 3,000

With a monthly savings of $3,000 you’ll meet and surpass your target in just 4 months.

Sounds interesting right!

But you don’t just raise your savings. You’re also raising your endurance limit and building self-discipline. So many benefits from one technique!

This takes us to the next advantage.

2. This techniques is a lesson in discipline and resilience

Frugal living is one of the most touted techniques of personal finance. This budgeting strategy helps you build the very qualities needed for frugal living: discipline and resilience. 

By going the extra mile to save a large part of your income. And then disciplining yourself to live without some extra pleasure at least for some time, You’re building the valuable skills of discipline and resilience. Both are needed for long term financial stability.

3. By breaking down goals into smaller, more manageable tasks, you are more likely to achieve success.

Just like every budgeting strategy, the key is to break down your expenses into smaller reachable goals.

As with most over-spenders, the real issue is that it is difficult to know when you’re about to cross the line of over spending. 

Dividing your income into clear sections reduces the problem of excess spending.

4. It gives due  importance to your needs.

Balance is the key to budgeting. Of what use if you save up so much that your health suffers because you deprived yourself of nutritious food? The 60-30-10 rule gives proper attention to caring for your needs. 

Advocates of other budgeting techniques such as the 50-30-20 rules points out the aggressive saving, as a No No!. But if you take a second look, you’ll see a pattern.

Both techniques give equal importance to caring for your needs (30% each). But with this budgeting style, you’ll meet your savings deadline faster.

5. The 60-30-10 rule budget can be used in any area of your life, including work, home, and personal goals.

Because of its versatility, this budgeting style can be applied to different areas of life. 

Have you thought of how to manage your time with a busy schedule, then try dividing your time into 60, 30, and 10 percent respectively. So in effect, you’re saving not just your finances, but also your time. 

This takes us to the next advantage of this rule. Your time.

6. The 60 30 10 rule is a helpful guideline when it comes to managing time.

Have you heard the saying: “Time is money”? It simply means that time is important. The 60-30-10 rule is a fast and effective way to meet savings targets quicker.

In the example mentioned earlier, a target of $10,000 is met (and exceeded) in 4 months. Note that was accomplished at no extra cost to basic needs.

This budgeting style is not without its flaws though. But this ability to reach savings targets in a short time frame, is its biggest selling point.

How can we save more without affecting basic needs? The answer lies in our ability to differentiate our needs from wants. 

Let’s not get it confused, taking care of our wants is also important. This adds spice and beauty to the stressed and bland lives brought by modernization. But if you need to raise funds for a project in a short time, what better place to cut from than from ‘leisure money’? 

This is the secret of the 60-30-10 budget. You care for your needs, and save extra funds from ‘leisure money’.


1. The 60-30-10 rule is often cited as a reason why businesses are not as productive as they could be.

The argument is that recreation and funds improves overall well-being. This in turn translates to better productivity. Reducing income for these activities to save more, in the long run, can adversely affect well-being and satisfaction that can translate to drop in productivity.

Do you really believe this? Well, there’s a point in this argument. In the long run, and without proper balance, this might be true.

2. The rule is based on the assumption that businesses should be organized in such a way that 60% of their resources are used to produce goods and services, 30% of their resources are used to finance these activities, and 10% of their resources are used to manage these activities.

When applied strictly in business and production, this might be a flawed budget strategy. Here is where caution is needed.

3. Critics argue that the 60-30-10 rule is outdated and does not take into account the changing needs of businesses.

Still here, the argument is, without balance and flexibility, this rule is flawed. 

Because business needs changes, it is good to also adapt any budgeting style to your needs. Either, this rule is not  strictly applied in every situation or business suffers.


60-30-10 rule budget chart

For all those who are new to budgeting, the 60-30-10 rule might seem daunting. But let’s break down how you can create this budget… step by step.

1. Start by creating a budget sheet that includes all of your expenses.

Starting is often the hardest part of most endeavors. 

Here we go! 

  • Create an Excel sheet, or a budget spreadsheet  or even the classic sheet of paper. 
  • Now write down all your expenses. If this is difficult, take a careful look at last month’s expenses, this should give an idea of what basic expenses are.

2. Next, create a list of all of your income sources.

Are you salaried? Do you have some side income? If you have invested in some investment plans, you should be getting some funds from there too. Add these to the list created in step one, above.

3. Next, create a list of all of your expenses and income sources.

Now write them all in your budget spreadsheet. One table for your expenses, the other for income sources.

4. Compare and contrast your two lists to find where you can make cuts.

Having these two columns side by side, will help you to see things in perspective.

Can you find any expenses that you can do without, start from there. Likely, you’ll find more than one channel that drains your income, that you can live without. These should go.

5. Create a rule for yourself that says you will spend no more than 60% of your income on expenses and no more than 30% of your income on income.

This is where the 60-30-10 rule comes in. So go head and write down your budget strategy or goals. Past it on 

  • your fridge, 
  • close to the handle if possible. 
  • Just anywhere that will easily remind you that you’re on a budget.

6. Follow your rule and make cuts where necessary.

Now here is the hardest part. There is no shortcut to this process. 

Do you plan on going to the cinema? Maybe you can consider watching a movie on Netflix with your family. Use this as an opportunity for family bonding.

How about your yearly vacation to the Caribbean? You can try going to the countryside nearby. I can assure you you’ll have a different kind of fun. Our frugal readers will be like, “heck No. I’m cancelling the entire trip”. Fine! If you fall into this category, go ahead and cancel.

By the way frugal living is real. I’m not one of them, but I respect them when I see one. Check out this real example.

Develop the will to be self-disciplined. And write down your progress in a diary. Write down how much extra you have saved in the process. Seeing your progress in writing is a motivation to keep going.

7. At the end of each month, compare your new budget with your original budget and make any necessary adjustments.

This process is not perfect. So do a monthly check. Compare and adjust accordingly.

8. Repeat the process until your budget is perfect.

Review steps 2 to 7, and adjust accordingly. Then repeat the process until your budget is good enough.

Do not worry. You can never be perfect at budgeting. So, its fine if you dont nail it in your first try. But you will get better with every try. So,

1. Start by creating a list of your expenses and income.

2. Next, identify which expenses are essential for your lifestyle and which can be reduced or eliminated.

3. Create a budget based on the essential expenses and adjust as needed. And

4. Live within your budget and stick to the rule to enjoy the benefits of a more luxurious lifestyle without overspending.


60 30 10 rule money
  1. Do some research on what’s affordable for you.
  2. Stick to your budget guidelines.
  3. Prioritize your needs.
  4. Shop around for the best deals.
  5. Don’t be afraid to make sacrifices.
  6. Be honest with yourself about what you can and can’t live without.
  7. Be patient and take things one step at a time.
  8. Get creative with your money-saving strategies.
  9. Stay organized and keep track of your expenses.
  10. Stay positive and stay motivated!

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