How Much Should You Budget for Your Needs?

A good rule of thumb that we recommend at NERDWA is called the 50 30 20 budget. This helps you allocate all of your expenses into these three different buckets. We recommend when it comes to needs, so things like housing and insurance,. You should spend no more than 50% of your take home income in this category. The next area is the 30% and that's the fun area. That is what you can spend on your wants. And then finally, you have the 20%. So this is what you should be using to put towards your savings, your debt repayment.