Spend, splurge and save with the 50/30/20 budget rule
If you’ve ever wondered how to juggle everyday expenses while still building up your savings, the 50/30/20 budget rule could be the simple yet effective answer you’re looking for. It’s not about spreadsheets and number-crunching, it’s all about balance.
This rule splits your income into three easy-to-manage categories: 50% for spending on needs, 30% for splurging on wants, and 20% for saving. Let’s break it down.
What is the 50/30/20 rule?
First popularised by U.S. Senator Elizabeth Warren, the 50/30/20 rule is a practical guide for everyday budgeting. It’s designed to make financial management easier while still leaving room for a bit of indulgence. The idea is to allocate:
- 50% to SPEND on needs:
This category is for your non-negotiables. Housing, utilities, food – these are the core expenses that keep your life running smoothly. While 50% might seem like a big chunk, if your needs are eating up more than half of your income, it might be worth revisiting where you can trim costs.
Could you save on your energy bill? What about finding a cheaper supermarket? Being strategic here gives you more room to play in the other categories. - 30% to SPLURGE on wants:
Here’s where the 50/30/20 rule really stands out, it gives you permission to enjoy your money! Splurging on a little luxury here and there isn’t just okay, it’s part of a healthy budget.
By setting aside 30% of your income for things you want (but don’t necessarily need), you can enjoy guilt-free spending. Whether that’s upgrading your wardrobe, going out for brunch, or splurging on a concert, this category is designed for fun without derailing your finances. - 20% to SAVE or invest:
The final 20% goes toward saving or reducing debt. This isn’t just for building an emergency fund, but also for setting yourself up for future financial stability.
Whether it’s growing your savings, investing, or paying down debt faster, this portion is all about moving forward. Even if 20% feels like a stretch right now, start small and build up. Consistency is key.
Why the 50/30/20 rule works
The beauty of this rule is its simplicity. Instead of tracking every dollar, you focus on balancing your spending across just three categories. It also keeps your budget flexible, letting you enjoy life’s pleasures while staying financially responsible. Plus, with “spend, splurge, and save” as your new mantra, it’s easy to remember and stick to.
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Savings Account
5.35% p.a. (for $0 to $250,000)
4.75% p.a.(for $0 to $1,000,000)
Yes up to $250,000
Bonus variable rate is available for the first 4 months.
Enjoy a high interest savings account with no account keeping fees to pay. Save up to 10% on eGift cards at over 50 retailers with Macquarie Marketplace. Multiple 2024 Mozo Experts Choice Award winner.
CompareCompareSavings Account
Enjoy a high interest savings account with no account keeping fees to pay. Save up to 10% on eGift cards at over 50 retailers with Macquarie Marketplace. Multiple 2024 Mozo Experts Choice Award winner.
- Maximum rate
- 5.35% p.a. (for $0 to $250,000)
- standard interest rate
- 4.75% p.a.(for $0 to $1,000,000)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- Bonus variable rate is available for the first 4 months.
- Access
- BPay, Branch access, Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must have a Macquarie Transaction Account to link with.
Read our Mozo Review to learn more about the Macquarie Savings Account
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High Interest Savings Account
5.75% p.a. (for $0 to $250,001)
4.40% p.a.(for $0 to $250,001)
Yes up to $250,000
Bonus rate for the first 4 months from account opening
Reward yourself with a higher rate for your good savings habits with the Rabobank High Interest Savings Account. No Account keeping fees. No minimum balance. Support Aussie farmers with every dollar you save.
CompareCompareHigh Interest Savings Account
Reward yourself with a higher rate for your good savings habits with the Rabobank High Interest Savings Account. No Account keeping fees. No minimum balance. Support Aussie farmers with every dollar you save.
- Maximum rate
- 5.75% p.a. (for $0 to $250,001)
- standard interest rate
- 4.40% p.a.(for $0 to $250,001)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- Bonus rate for the first 4 months from account opening, reverting to standard variable rate. Rate shown is for Personal customers and is subject to change. Different rates apply to Business/SMSF customers.
- Access
- Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must link to a transaction account
Read our Mozo Review to learn more about the Rabobank High Interest Savings Account
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Savings Maximiser
5.50% p.a. (for $0 to $100,000)
0.55% p.a.(for $0 and over)
Yes up to $250,000
Deposit $1,000 into a personal ING account, make 5 eligible transactions with a linked Orange Everyday account and grow the balance each month.
Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^
CompareCompareSavings Maximiser
Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^
- Maximum rate
- 5.50% p.a. (for $0 to $100,000)
- standard interest rate
- 0.55% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- For customers who deposit $1000 from an external source into a personal ING account (excluding Orange One and Living Super), make 5 eligible transactions and grow their nominated Savings Maximiser account each month so there is more in the account at the end of the month than there was at the start of each month (excluding interest). The total bonus interest rate is available on balances up to $100,000 on one Savings Maximiser the next month after meeting eligibility.
- Access
- Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must be linked to an Orange Everyday transaction account to receive the bonus rate. Where multiple Savings Maximiser Accounts are held, the bonus rate is only applied to one nominated account.
Read our Mozo Review to learn more about the ING Savings Maximiser
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Growth Saver Account
5.05% p.a. (for $0 and over)
0.35% p.a.(for $0 and over)
Yes up to $250,000
Grow your net balance by at least $200 (excluding interest) and make no more than one withdrawal in the month.
Grow your savings goals with no monthly account keeping fees to pay. To get the bonus interest simply grow your net balance by at least $200 a month (excluding interest) and make no more than one withdrawal during the month. No debit card, ATM, eftpos or personal cheque access with this account Suncorp Bank (Norfina Limited ABN 66 010 831 722 AFSL 229882 Australian Credit Licence 229882). The SUNCORP brand and Sun Logo are used by Suncorp Bank (Norfina Limited) under licence and Suncorp Bank is not part of the Suncorp Group.
CompareCompareGrowth Saver Account
Grow your savings goals with no monthly account keeping fees to pay. To get the bonus interest simply grow your net balance by at least $200 a month (excluding interest) and make no more than one withdrawal during the month. No debit card, ATM, eftpos or personal cheque access with this account Suncorp Bank (Norfina Limited ABN 66 010 831 722 AFSL 229882 Australian Credit Licence 229882). The SUNCORP brand and Sun Logo are used by Suncorp Bank (Norfina Limited) under licence and Suncorp Bank is not part of the Suncorp Group.
- Maximum rate
- 5.05% p.a. (for $0 and over)
- standard interest rate
- 0.35% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- Grow your net balance by at least $200 (excluding interest) and make no more than one withdrawal in the month.
- Access
- Branch access, Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- -
Read our Mozo Review to learn more about the Suncorp Growth Saver Account
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MoneyMAX Account
No Current Offer
4.75% p.a.(for $1 and over)
Yes up to $250,000
Unlimited access 24/7 via Banking App, Phone & Internet Banking. Interest is calculated daily and paid monthly. No transaction fees or monthly service fees. No minimum balance or withdrawal restrictions. Online access only.
CompareCompareMoneyMAX Account
Unlimited access 24/7 via Banking App, Phone & Internet Banking. Interest is calculated daily and paid monthly. No transaction fees or monthly service fees. No minimum balance or withdrawal restrictions. Online access only.
- Maximum rate
- No Current Offer
- standard interest rate
- 4.75% p.a.(for $1 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- n/a
- Access
- BPay, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Branch access for deposits only.
Read our Mozo Review to learn more about the Unity Bank MoneyMAX Account
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