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PSA: The 50/30/20 budget rule almost wrecked my savings plan
My coworker Dave swore the 50/30/20 rule was foolproof - 50% needs, 30% wants, 20% savings. I followed it for 6 months in Austin and ended up with only $200 saved because my rent alone ate up 45% of my income. On the flip side, my sister in Omaha swears by it and has $4,000 saved. Is this rule really one-size-fits-all, or does where you live totally break it? Anyone else find that the 50/30/20 just doesn't work in expensive cities?
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stone.thomas1mo ago
Rent taking 45% of your pay means the rule is already broken before you even get to food. That's not a budget problem, that's a housing market problem. The whole 50% for needs assumes your biggest bill is manageable, not half your check. Did Dave even factor in things like car insurance, groceries, or utilities when he told you to follow it? Those add up fast and push you way over 50%. Sounds like the rule works best when your rent is under 30%, which is a luxury in Austin.
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