Smart Money: The 50/30/20 Rule

A Simple Framework for Personal Budgeting Grade 9 Business Class

What is the 50/30/20 Rule?

A simple budgeting framework Divides your income into three categories Created by Senator Elizabeth Warren Easy to remember and apply

The Three Categories Explained

50% - Your NEEDS

Essential expenses you cannot avoid Housing (rent/mortgage) Utilities (electricity, water, internet) Groceries and basic food Transportation costs Minimum debt payments

30% - Your WANTS

Things that improve your lifestyle Dining out and takeaway Entertainment and hobbies Streaming services and subscriptions Shopping for non-essentials Travel and vacations

20% - Your SAVINGS & DEBT REPAYMENT

Building your financial future Emergency fund (3-6 months expenses) Retirement savings Extra debt payments Investments and long-term goals

Let's Calculate Together!

Monthly Income: $2,000 Calculate your 50/30/20 budget Work with a partner Show your math!

What are the Benefits and Limitations?

Think-Pair-Share: What advantages does this rule offer? What challenges might you face? When might you need to adjust the percentages?

Real-World Application

{"left":"High school student with part-time job: $800/month\nCollege student with financial aid: $1,500/month\nRecent graduate starting career: $3,000/month","right":"Each scenario requires different strategies\nRule provides flexible framework\nAdjust percentages based on life stage"}

Your Turn: Create Your Budget

Choose a monthly income scenario Apply the 50/30/20 rule List specific items in each category Prepare a 2-minute presentation Be ready to explain your choices!