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I just realized that we have four months left for this year 2022 to take a bow. I have scanned my bank account and realized that i didn't stick to my new year resolution of saving at least 30% of my income. Well, when i made that decision, i didn't know that the economy situation of the country will be this bad. Things are relatively high and one bad thing here is that once the price of things climbs, it never comes down. It can be annoying some times.

Having looked at the situation of things, i think there is still hope to save some money for myself. I just have to sit down and apply the 50/30/20 rule. A friend of mine told me about how efficient this 50/30/20 rule has been for her and I am about to give it a big try. If it is something that will work, I will be so glad to use the rule for the remaining four months in the year.

What is the 50/30/20 rule?

After she explained to me, i deduced that the rule is just dividing whatever income you have into three parts to fit your needs, your wants and your savings. This method helps one to manage their income more effectively. The 50% goes to your needs, the 30% goes to your wants and lastly the 20% goes to your savings.

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To get this, I think you have to understand your needs and wants first. I think this is where a lot of persons get it all wrong. So many people do not understand a need from a want thereby making them spend money unnecessary and at the end of the day, they either go broke or get into a huge debt. I wrote an article on understanding your wants and needs. You should check it out here

The effectiveness of the rule

When you know the exact percentage of what to spend on either of the categories, it is a lot easier for you to keep your spending habit in check. If you understand that your needs are just things that you cannot live without and spend 50% on them, and your wants are just things you can do without for the main time, it will be easy for you to save the remaining 20%.

Let's say for example, you have a choice of getting some groceries and buying a new pair of shoes. I will say that right now, your need will be getting the groceries because you must eat. You can manage whatever footwear you have for the main time. This is only efficient when you as an individual have self- control over your finance. It is not easy to overlook a lot of things.

There are lots of beautiful things coming out every now and then and if you don't have that self-control, you will surely end up getting those things which fall into the Want category. So the trick is having self-control. I hope this works for me as I am willing to try it out.

Has anyone tried out this 50/30/20 rule? Is it efficient?

Thanks for reading.

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