Student budgeting is an individual case. Rent, food, books, and fun are usually paid from the same wallet. When money is tight, it can be difficult to divide it properly. That’s where budgeting formulas such as 50/30/20 and 60/30/10 are there to assist you.
Yet, what method will you use to find out which one suits you best? The difference between such formulas could be the very secret of your financial accomplishment. Whether it is covering the rent budget or saving for a trip, the impact of the right formula on the journey is huge.
So, 50/30/20 vs 60/30/10: With the Blitz app, you can find out which budget formula fits your student life. Let’s break it down!
Understanding the 50/30/20 Rule
Handling your money as a student can really be a challenge. The 50/30/20 rule offers a convenient way to spend and save one’s revenue. Here’s how:
What Does the Formula Mean?
The 50/30/20 rule splits the income into three separate parts: needs, wants, and savings. Here’s the breakdown:
- 50% Needs: To cover the absolute necessities, such as rent, food, and other household utilities.
- 30% Wants: To be used on things that add fun and happiness to the lives of people, such as socializing and entertainment.
- 20% Savings: Saved for the future, shelter-in-place, debt, or investing.
Why is it popular among students?
The 50/30/20 rule is adored by students mainly because of its simplicity and effectiveness. Some of the main reasons include:
- Clear Breakdown: The rule helps you see where your money goes. No complex math is needed to set your budget.
- Flexible for College Life: College can be unpredictable. This rule makes it easy to be flexible in your “wants” category when needed.
Read: Best 4 Budgeting Apps for Students
Understanding the 60/30/10 Rule
In case you are a student with unstable earnings or who has very little income, then 60/30/10 would be the ideal budgeting formula for you. This allows for more flexibility for necessities while still inviting savings and recreation. Here’s what it is:
What the Formula Means
Here is the explanation:
- 60% Needs: The largest part, 60%, is the allocation to bare necessities such as housing, food, and utilities.
- 30% Wants: 30% can be spent on anything that is not a necessity, such as entertainment, dining out, and shopping.
- 10% Savings: Save 10% of your income for the likes of an emergency fund or debt payments.
Why Some Students Prefer This Model
Many students find the 60/30/10 rule easier for managing a tight budget. Here’s why:
- Higher Allowance for Essentials: By setting 60% apart for necessary expenses, you can take care of rent and food, especially in expensive areas.
- Lower Savings Pressure: A 10% savings would definitely feel less hard than 20%. Saving this way, you can concentrate on your needs without spending every penny in your budget worrying.
- Flexibility: With the 60/30/10 rule, the budget doesn’t become overly tight, as the essential part is balanced with the fun and the savings.
Key Differences Between 50/30/20 and 60/30/10
Picking the right budget plan right can have a very positive impact. Here are some essential differences that will allow you to choose the best one.
Savings Priorities
The main difference is how much you save. Here’s a breakdown:
- 50/30/20: Suggests that 20% of your annual income is to be left for savings.
- 60/30/10: Spend just 10% of your income on savings. It may relieve immediate pressure, but it may end up postponing bigger ambitions.
Lifestyle Flexibility
The greatest difference in lifestyle adaptability is the way you deal with your “wants.” Both rules designate 30% of your income to “wants,” but the proportion between needs and wants differs.
- 50/30/20: The rule gives 50% of your income to needs.
- 60/30/10: In this case, 60% of your income goes towards needs.
Essentially, the 60/30/10 rule enables you to live your college life completely.
Also Read: Common Student Budgeting Mistakes and How to Avoid Them
Fit for Different Student Budgets
Your selected budget ratio relies on how predictable your income is.
- 50/30/20: This suits students with steady incomes, such as consistent part-time work. It enables you to save more and cover your basic needs.
- 60/30/10: This works better for students with variable or limited income. With 60% for needs, it leaves more room for dealing with fluctuating expenses.
Which Formula Fits Student Life Better?
Selecting between the 50/30/20 and 60/30/10 formulas is based on your income and outlays. Let’s examine which one is better suited to various student circumstances.
For Students With Part-Time Jobs or Internships
If you have a steady part-time job or internship, consider the 50/30/20 rule. It pushes one to save 20% for the future. With a stable income, you can save and live, and meet your necessities.
For Students Relying on Allowance or Loans
If your income is less predictable and you live on allowances or loans, the 60/30/10 rule will be more appropriate. It keeps 60% for necessary expenditure, so you can deal with immediate expenses with fewer worries about saving.
For Students With High Living Costs (City/Hostels)
Living in an expensive city or hostel can complicate budgeting. Here, the 60/30/10 formula works best. The higher portion for needs gives you more room to handle rent, food, and transport costs.
Practical Hacks to Make Either Formula Work
You can use simple tricks to make your budget work regardless of the budgeting formula used. These hacks allow you to keep your budget without feeling like you are being controlled.
Track Expenses Automatically
Tracking your expenses is a major aspect of the 50/30/20 or 60/30/10 rules. Blitz is one of the apps that can be used to allocate expenses under “needs”, “wants”, and “savings”. This way, you get a clear view of your budget without the tedious process of manual tracking.
Use Student Discounts & Subscription Swaps
Reducing the “wants” does not mean that you have to get rid of the fun. Take advantage of student discounts on entertainment, food, and clothing. Replace expensive subscriptions with cheaper or free ones. By doing this, you save without giving up your social life.
Build Savings Gradually
If you decide to use the 60/30/10 rule and save only 10%, do not stress. Establish automatic transfers to your savings account right after payday. Gradually, you will be able to build up your emergency fund even with small amounts.
Case Study – Student Budgets in Action
Let us consider two actual examples and observe how the 50/30/20 and 60/30/10 equations work out for students.
Example 1: Alex Using 50/30/20
Alex earns $800 a month. Here’s how the 50/30/20 formula breaks down for him:
- $400 for needs (rent, food, utilities)
- $240 for wants (socializing, entertainment)
- $160 for savings (emergency fund, future goals) B
By the end of the semester, Alex will have saved $640, allowing him to create a good financial reserve.
Example 2: Maya Using 60/30/10
Maya receives a $600 monthly allowance. Here’s her budget breakdown with 60/30/10:
- $360 for needs (rent, food, utilities)
- $180 for wants (social life, entertainment)
- $60 for savings (emergency fund, paying off debt)
Maya will have $180 saved up by the end of the semester, having a little in savings but not as much money as Alex does.
How Blitz Helps Students Apply Budget Rules
Blitz is your AI-powered financial companion, designed for students. It’s not just another payment app; it’s your ticket to stress-free money management and a stronger financial future.
Here’s how Blitz fits into both formulas:
- BudgetGPT → AI budget coach that keeps your 50/30/20 or 60/30/10 spending in check.
- JobsGPT → Finds the best part-time gigs so you can boost income and hit savings targets.
- DealsGPT → Sniffs out discounts, cashback, and student deals to keep wants affordable.
- PriceGPT → Compares prices in seconds to save money on groceries, clothes, and more.
Whether it’s covering essentials, planning trips, splitting party costs, or just stretching your budget, Blitz makes either formula easier to stick to.
Quick Checklist – Choosing Your Budget Formula
Ready to select the budget formula that is most suitable for you? Simply follow this simple checklist and begin.
- Calculate your average monthly income
Find out how much money you make in one month. Part-time job, allowance, or financial aid, this is the money that comes to you. - List essential expenses
Write down necessary expenses like rent, food, utilities, and transportation. These are your “needs” and will figure out how much of your income should be used for the bare necessities. - Pick 50/30/20 or 60/30/10
Based on your income and expenses, choose the formula. If you require more space for necessities, opt for 60/30/10. If you prefer saving more, 50/30/20 would be preferable. - Track with Blitz and adjust as you go
Use an app like Blitz to keep track of your spending. That way, you will be within budget and switch if needed.
Conclusion – The Best Budget Is the One You Can Stick To
When budgeting, select a formula that you can maintain. The 50/30/20 and 60/30/10 rules both suit students. The important part is consistency. Whether saving for future goals or managing essentials, pick a formula that fits your life and income.
Use tools like Blitz to keep budgeting simple. With some discipline, either formula can help create a balanced budget that meets your goals without stress. Select the model that feels right for you. It’s all about making your money work for you.
Start today with Blitz and discover how easy budgeting can be. The right formula for your student life is just one choice away!
FAQs on 50/30/20 vs 60/30/10
Is 50/30/20 too strict for students with low income?
It might seem tight, but balance is key. The 50/30/20 rule can be adjusted for low-income individuals. It is possible to allocate a higher percentage to “needs” and a lower one to “wants” categories.
Can I switch between 50/30/20 and 60/30/10?
Yes! Budgeting is not only for one specific method. If you think that at some point you need more money for essentials than for a budget, you can then switch to the 60/30/10 formula. The goal is to figure out what fits you best and adjust accordingly.
Which budgeting formula helps save for emergencies faster?
The 50/30/20 rule will assist you in saving quickly, as it invests 20% of your income in savings. In case emergency savings are a priority, this rule will assist you in creating your emergency fund in no time.
What if my needs exceed 60% of income?
If your requirements are over 60%, you may have to redo the formula to fit. You can adapt by reducing the “wants” or “savings” categories temporarily until your situation changes.
How does Blitz simplify budgeting for students?
Blitz makes budgeting easy! It does the job of tracking your spending and categorizing it into needs, wants, and savings automatically. You just have to set it up and let Blitz do the rest.
