On payday, it’s easy to get caught up in the excitement of spending. I’d find myself picking out the latest outfits or splurging on things I didn't need – all in line with my lifestyle. By mid-month, I’d wonder where all the money had gone and how I’d make it through the rest of the month.

If you’ve ever felt like your finances are slipping away, it might be a sign that your money management is off-track. One effective method to try is the 50/30/20 budgeting rule.

What is 50/30/20 budgeting rule?

The 50/30/20 method is a simple budgeting system for managing personal finances. This method divides your income into three categories: essentials, commitments, and savings.

Read also: Master Your Budget: Steps, Importance & Tips

How does the 50/30/20 rule work on a RM4,500 salary?

Want to see how the 50/30/20 rule works with a monthly salary of RM 4,500? Here’s a simple breakdown to get you started:

By following the 50/30/20 rule, you can easily manage your daily expenses while building a savings cushion for the future. It’s a straightforward way to balance your spending and savings, giving you more control over your finances and a greater sense of security.

5 budgeting tips that you should know

While we’re here, let’s explore some simple tips to kickstart your budgeting journey.

If you're looking for a deeper dive into budgeting and managing your finances, check out EPF's My Money Matters 2.0 guide. It’s packed with practical tips to help you make smarter financial decisions and stay on track with your goals.

*Disclaimer: This information is intended as a general guideline. The 50-30-20 rule is a common approach for income allocation. However, depending on your financial situation, this rule can be adjusted to better suit your needs.