Moneyadviceblog » Budgetingtitle_li=Budget » What Is The 70-20-10 Budget?

There are different kinds of budgeting plans, from the easiest to the most challenging, but the good thing is that you have the choice and may choose the one that fits you the most. If you have tried budgeting but have failed in the past, this template may be made for you.

This concept is for people who do not want to make up 50 categories; not everyone has spare time. This is a very easy version of budgeting that will still control your money. 

What Is The 70-20-10 Budget?

What Is The 70-20-10 Budget?


There are three major categories in this concept; spending, saving and giving. 


In this category, you should be able to fit all of your spendings. To start, you should calculate your income after taxes. Expenses that will be part of the 70 % are;

  • Rent
  • Car payment
  • Insurance
  • Utilities 
  • Credit card

Expenses (Fixed Or Variable)

Examining fixed and variable expenditures is one method to divide your spending categories. Your fixed costs are those for which you must pay a predetermined sum each month. They are “simple” expenditures to compute because they don’t fluctuate from month to month; they are “simple” expenditures to compute. Unless your landlord has to raise the rent now and again, you can typically depend on your mortgage or rent keeping the same every month.

Variable expenditures are those that are subject to change depending on the situation. For example, during the holidays, you could spend more on dining out. During the more mild seasons of the year, your utility costs may be lower, but they may be higher during extreme cold or heat. Your spending habits might cause variations, but causes beyond your control can also cause them.

Fixed Expenses:

  • Mortgage
  • Subscription
  • Memberships
  • Utilities

Variable Expenses:

  • Groceries
  • Entertainment
  • Travel
  • Fuel
  • Clothing


This is a less subsequent portion as it makes up only 20 %, but it is very important. This is the main objective of this plan, to save. If you find it difficult to save 20 % of your income, you may start by saving 10 % and working your way up. 

It is difficult to live paycheck to paycheck, so it is important to have an emergency fund and savings for later. There are various plans that you can check for saving if your ultimate goal is to save a max.


This will be used for ‘giving’; it can be to charity, to your loved ones, if there are birthdays during the months, weddings, or any other celebrations.

If there is money left in this category, you may want to use it to pay off your debts. You may think that debts are already in the 70 %, but take time and think about it. The more you pay, the more you get out of debt faster if you give extra money per month.

What Is The 70-20-10 Budget?

What Is The 70-20-10 Budget?

If you have a lot of debt, you may want to look for a budgeting plan to fit a quick debt payback rather than saving. You can look for the debt avalanche or the snowball methods, which are good methods for debt repayments; you may take time to go through both methods to find better for your situation.

Advantages of the 70-20-10 methods

  • Less difficult than other methods.
  • Simple to use.
  • Do not require a lot of categorizing, thus time-saving.

Disadvantages of the 70-20-10 methods

  • It may be too simple for some.
  • Not everyone can live on the 70 %.

You may want to look at our different budget plan ideas to see what fit you the most. In the comments, let us know your financial goals for 2022; saving, going debt-free or other…