Salary runs out within days?:Expert explains the 50-30-20 rule, where to cut costs, prioritise needs, how to invest wisely, and grow savings

For many people, the monthly salary gets exhausted within 10 days of being credited. Rent, EMIs, school fees, groceries, utility bills and commuting costs quickly eat into income. Every month ends with the same question—how to save? While many blame low income, financial experts say the real issue is the lack of planning. Savings are possible at any income level if spending is structured and goals are defined in advance. Financial expert Jitendra Solanki explains the 50-30-20 rule, a simple framework that helps direct your money from the moment your salary arrives. It isn’t rigid, but it provides clarity and discipline. In today’s Your Money column, we explain how savings are possible even on a modest salary and cover: What is the 50-30-20 rule? The rule divides your income into three parts: 50% — Needs
Essential expenses that cannot be avoided: 30% — Wants
Non-essential expenses that improve lifestyle: 20% — Savings and Investments
Money set aside for future security: The aim is not to follow these percentages rigidly every month, but to plan spending before the salary arrives. If you can save more, invest more—but ensure at least 20% of your income is consistently directed towards savings and investments. Q: How can you save on a low salary? A: It’s a common misconception that saving isn’t possible with a low income. Many people wait for a salary hike to start saving, but expenses usually rise along with income—so the “right time” to save never comes. Savings always begin small. If your income is limited: You don’t need to save 20% from your first paycheck. The initial goal should be simple—save something every month. Income grows over time, but without disciplined planning, expenses grow just as fast. Q: Does the 50-30-20 rule apply to all income groups? A: Yes, but it’s flexible. If your income is low: If your income is higher: Percentages can change based on circumstances, but the habit of saving should remain constant. Q: What if nothing is left to save after rent, EMIs and essentials? A: This situation is common—but it doesn’t mean saving is impossible. It usually means spending is unplanned. Start with these steps: Small, frequent costs—such as eating out often, unused app subscriptions and impulse shopping—quietly drain savings. Controlling these can free up money to save every month. Q: Is it mandatory to strictly follow the 50-30-20 rule? A: The 50-30-20 rule is only a guideline, not a rigid formula. If you have higher expenses—such as children’s education, medical costs, or a new loan—your savings may reduce temporarily.
However, once these expenses ease, it’s important to redirect that extra money back into savings. Maintaining this habit is what defines financial discipline. Q: How can you save when credit card bills and loan EMIs are ongoing? A: Savings are possible even when you have existing liabilities. Start by clearing credit card dues first, as they attract the highest interest. Treat loan EMIs as fixed monthly expenses and ensure they are paid on time. Begin with small savings—around 5–10% of your income or ₹1,000–₹2,000 per month. Cut down discretionary spending and avoid fresh purchases on credit cards. If you receive any additional income, use it primarily to reduce debt. Once liabilities are under control, gradually increase your savings. Q: What are the best investment options for the 20% savings portion? A: The 20% earmarked for savings can be divided into three parts: Emergency Fund Short-Term Goals Long-Term Investments Q: Should budget planning begin right from the start of your career? A: Yes, budgeting should start as soon as you begin working. Learning to manage money early helps you achieve financial stability faster. Track your expenses from your very first salary and build a habit of saving. This approach reduces future dependence on loans and credit cards. Q: Does the 50-30-20 rule work for couples and family budgets too? A: Yes, the rule is equally useful for couples and families.