What is a 60/30/10 Budget? A Smart Rule to Manage Your Money Effectively

Do you want to take control of your money but don’t know where to start? The 60/30/10 budget rule offers a simple, effective way to plan your monthly income without complex spreadsheets. Let’s break it down with real-life examples for Indian households in 2025.

📌 What is the 60/30/10 Rule?

This rule divides your monthly after-tax income into three easy categories:

• 60% – Needs (Essentials)
• 30% – Wants (Lifestyle)
• 10% – Savings & Investments

Example: Ravi, who earns ₹50,000/month in Hyderabad, follows this rule. He spends ₹30,000 on rent, bills, groceries (Needs), ₹15,000 on shopping and entertainment (Wants), and invests ₹5,000 in a mutual fund SIP (Savings).

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🏠 60% for Needs

These are non-negotiable expenses you must pay every month:

• House rent or home loan EMI
• Electricity and water bills
• Groceries and basic food
• Transport, fuel, metro pass
• Mobile and internet

Smart Tip: If your “needs” are over 60%, try switching to a cheaper internet plan, carpooling, or meal prepping.

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🎉 30% for Wants

This is where your lifestyle expenses go — optional, but enjoyable:

• Eating out / Swiggy orders
• OTT subscriptions (Netflix, Amazon Prime)
• Shopping – clothes, gadgets
• Weekend trips and hobbies

Real Use Case: Meena budgets ₹10,000/month for her “wants.” Instead of Netflix + Prime + Hotstar, she uses Amazon’s bundled plan to save ₹400/month.

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💰 10% for Savings & Investments

This is your future money — wealth-building zone:

• Mutual Fund SIPs
• Emergency Fund (via savings account or liquid fund)
• PPF, NPS, or Digital Gold
• Stock market or ULIPs

Pro Tip: Automate your SIP via Groww, Paytm Money, or ET Money. It ensures you invest first — not what’s “left over.”

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📊 Sample Budget Breakdown (₹60,000 Monthly Salary)

Category	Amount (₹)
Needs (60%)	₹36,000
Wants (30%)	₹18,000
Savings (10%)	₹6,000

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📲 Best Budgeting Tools for Indians in 2025

• Walnut – Spend tracking via SMS
• Money View – Budget setup and auto categorization
• ET Money – Budget + SIP investing
• Google Sheets – Manual but customizable

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🧠 Why the 60/30/10 Budget Works

• Simple enough for students and young earners
• Flexible for families with different income levels
• Ensures you’re saving and not overspending
• Helps you plan better during salary hikes or job changes

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📝 Can You Adjust the Ratio?

Absolutely. If you’re a student or someone living with parents, your "needs" might be less. Try 50/30/20 or 40/40/20. The goal is to build a budget you can stick to.

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✅ Final Thoughts

Whether you're earning ₹20K or ₹2 Lakhs/month, the 60/30/10 rule gives you clarity. Don’t just save what’s left — spend what’s left after saving. Stick to this rule, and your financial life will feel easier, lighter, and smarter.

💬 Have you tried this rule? Share your experience or ask us how to customize it for your lifestyle!

🔗 Related Reading:

• How to Build an Emergency Fund in India