Need to know
Nationwide recommends the budgeting rule as a smart approach to taking control of your finances
Nationwide boats 50-30-20 budgeting rule to help save money
- Nationwide has urged Brits to try the simple ’50-30-20′ budgeting rule to help save money and manage finances more effectively.
- The technique involves splitting your monthly income into three categories: 50% for essentials like bills and food, 30% for wants such as eating out and hobbies, and 20% for savings or debt repayment. For someone earning £1,500 after tax, this would mean £750 for necessities, £450 for personal treats, and £300 towards savings.
- If this is not possible, it says: “The 50-30-20 rule is just an example. You can split in any way to meet your needs.”
- Experts at Nationwide suggest creating a budget plan and recommend listing all outgoings to stick to your financial goals. This includes everything from council tax and car payments to Netflix subscriptions and gym memberships.
- The building society advises reviewing your spending over the last 3 months to spot patterns and understand what a typical month looks like. Essential expenses include childcare, insurance, petrol, and basic toiletries, while wants cover eating out, personal treats, and entertainment subscriptions.
- For those struggling financially, Nationwide suggests cutting back on treats like morning coffee or streaming services, but adds that “if giving up your Spotify subscription or Friday coffee will make you unhappy, maybe keep them. It’s about balance and cutting back on things you feel you can give up comfortably”.
- READ THE FULL STORY: Nationwide’s 50-30-20 rule that could save you money
