The 50/30/20 rule
The 50/30/20 rule is a simple way to split your net (after-tax) income: 50% to needs, 30% to wants, and 20% to savings and debt repayment. It is a starting point, not a strict law.
The three buckets
Needs are rent or mortgage, food, transport and insurance. Wants are eating out, subscriptions, hobbies and travel. Savings are your buffer, your investments and paying down debt beyond the minimum. The idea is to see where your money actually goes.
Adapt it to Sweden
Base it on your net salary, tax is already deducted. In high-cost cities housing alone can exceed 50%, so treat the ratios as a guide and adjust to your situation. The 20% going to savings is the part worth protecting, because it is what builds your future security.
Where it shows up
- Budget
If your needs take more than 50%, do not give up. Shrink the wants bucket first and keep saving something. Consistency matters more than the exact split.