What is the 50/30/20 budget rule?

The 50/30/20 rule allocates 50% of your after-tax income to needs (rent, groceries, utilities), 30% to wants (dining out, entertainment, subscriptions), and 20% to savings and debt repayment. It provides a simple framework for managing money without tracking every dollar.

How much should I spend on rent in Australia?

Financial advisers generally recommend spending no more than 30% of your gross income on housing. In expensive cities like Sydney, many people spend 35-40%, which is considered housing stress. The lower you can keep this percentage, the more financial flexibility you have.

Budget Planner Calculator Australia

The 50/30/20 Budget Rule

The 50/30/20 rule is a simple budgeting framework: spend 50% of your after-tax income on needs, 30% on wants, and save/invest 20%. It's not rigid — you can adjust the percentages to match your situation — but it gives you a solid starting point.

Needs (50%) are essentials you can't avoid: rent/mortgage, groceries, utilities, insurance, transport, minimum debt repayments. Wants (30%) are things you enjoy but could live without: dining out, entertainment, subscriptions, holidays, hobbies. Savings (20%) includes emergency fund contributions, extra super, investments, and extra debt repayments above minimums.

Don't know your take-home pay? Use our Take-Home Pay Calculator first.

Related Calculators

Take-Home Pay → Savings Goal → Debt Payoff → Net Worth →

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Methodology & sources

This calculator uses current published rates from Australian government and regulator sources. The result is an estimate for general guidance — it does not constitute personal financial advice. For decisions about your circumstances, consult a registered financial adviser, tax agent, or other professional. See editorial standards for how DecisionLab sources and updates its calculator data.

Estimates only. This calculator is not intended to be relied on for making a decision about a financial product, and it does not consider your objectives, financial situation or needs. Consider obtaining advice from an Australian financial services licensee before making any financial decisions. Assumptions can be changed where shown; statutory rates are as legislated for the year stated on this page. How our calculators work, their assumptions and limitations →