Managing your money like the top 1% might sound complicated ,but it does not have to be .In this blog ,we can explain the 15/30/20 rule of money management ,
a straightforward and affective strategy that can help you take control of your finances.The rule breaks down your income into three main categories :15 % for
savings ,65% for wants and 20% needs .
15%:Savings
The 15 % of allocated saving and investing of your income such as emergency fund,future expenses(sinking fund),retirement fund),education fund,marrige fun,short term fund or passive income.within this category ,its wise to set aside 3-5% as an emergency fund .This fund facts as a financial safety
net ,protecting you from unexpected expenses like medical emergencies or urgent home repair.The remaining portion of this 10% should be invest in reliable option
such as index funds,which offer a balanced and diversified approach to growing your wealth over time.smart investing can help you build a secure financial future
and achive your long term goals.For example
If you earn 1 lakh
you can allocated 15,000/-(Charity)
or
you can allocated 65,000/-(Savings)
and 20,000/- (Live Off of account)
65%:Wants
The 65% allocated to stress -free spending allow you to enjoy life without feeling guilty about your expenses.This Part of your budget can be used for activities that bring you
joy and relaxation ,such as entertainment,restaurant, shopping,gym,hobbies,vacation,clothing,housing/rent,food ,inurance,groceries, healthcare,utilities or medical.By setting
aside money specifically for leisure,you can including in your interest without compromising your financial stability.This balance between saving and spending is key to maintaining
a healthy and happy lifestyle.For example:-
If you earn 1 lakh
you can allocated 15,000/-(Needs)
or
you can allocated 65,000/-(Investment)
and 20,000/- (Wants)
20%:Needs
The 75% allocated to needs .This portion of your income should cover essential expenses such as rent or housing,food,trasportation,insurance,groceries,healthcare,utilities or medical.By keeping track of these necessary costs,you can ensure that your basic needs are met without overspending.Budgeting for these
essentials helps you maintain a stable financial foundation ,which is crucial for long -term financial health.For example
if you earn 1 lakh
you can allocated 15,000/-(Needs)
or
you can allocated 65,000/-(Wants)
and 20,000/- (Invest or saving)
FAQs About 15/65/20 Budgeting Rule in India
What is the 15 65 20 budget rule?
Managing your money like the top 1% might sound complicated ,but it does not have to be .In this blog ,we can explain the 50/30/20 rule of money management ,
a straightforward and affective strategy that can help you take control of your finances.The rule breaks down your income into three main categories :15 % for
savings ,65% for wants and 20% needs .
What is the 50 30 20 budgeting plan?
One of the most common types of percentage-based budgets is the 50/30/20 rule. The idea is to divide your income into three categories, spending 50% on needs, 30% on wants, and 20% on savings.
Conclusion
the 15/65/20 rule of money management ,
a straightforward and affective strategy that can help you take control of your finances.The rule breaks down your income into three main categories :15 % for
savings ,65% for wants and 20% needs .