What is the 50-30-20 rule?
The 50-30-20 rule is one of the most widely used personal budgeting frameworks. It divides your monthly take-home income into three categories — needs, wants and savings — using fixed percentage targets.
The rule was popularised by US Senator Elizabeth Warren and her daughter Amelia Warren Tyagi in their 2005 book All Your Worth. It is valued for its simplicity: three numbers, one decision per rupee, applied consistently every month.
| Category |
Percentage |
What it covers |
| Needs |
50% |
Rent, groceries, utility bills, transport, loan EMIs |
| Wants |
30% |
Dining out, subscriptions, shopping, gadgets, leisure |
| Savings and investments |
20% |
Mutual fund SIPs, emergency fund, FDs, PPF, stocks |
How does the monthly budget calculator work?
The calculator applies the 50-30-20 formula directly to your monthly take-home income.
Needs = Income × 0.50 | Wants = Income × 0.30 | Invest = Income × 0.20
Worked example: Enter a monthly take-home income of ₹1,00,000. The calculator instantly returns ₹50,000 for needs, ₹30,000 for wants and ₹20,000 for savings and investments. Adjust the income figure and all three amounts update in real time.
Note: the calculator uses the standard 50-30-20 split as a starting guideline. Your actual allocation may differ based on your city, income level, and financial goals. Treat the output as a planning reference, not a fixed prescription.
How do I use Chola Securities' monthly budget calculator?
Using the calculator takes one step.
- Enter your monthly take-home income — the amount you receive after taxes and all statutory deductions.
The calculator instantly shows the three budget amounts. You do not need to enter any other details. Adjust the income figure at any time to see how your budget split changes.
Why use the monthly budget calculator?
- Translate the 50-30-20 rule into actual rupee amounts for your income, without any manual calculation.
- See at a glance how much you can spend on wants without overspending your needs budget.
- Know exactly how much to set aside for investments each month, before spending the rest.
- Use it as a monthly reset — revisit the calculator each time your salary changes.