Can the 50–30–20 rule be versatile?

Oh hey, all.

I decided to come back to something I haven’t done in a while.

I’d like to make this intro brief so we can get into the good stuff.

Yes, I used to blog about personal finance. If you know that particular space and read up on personal finance than the 50–30–20 rule is very familiar to you.

(Just a TL;DR on this rule — it’s the breakdown of spending 50% of your income towards necessities, 30% of your income towards the fun stuff, and 20% towards savings. Check out Nerdwallet’s explanation + calculator if you’re interested).

Here’s the deal. Yes, strategies and tactics are huge for creating a money system. Without strategy, you might not meet the milestones + money goals you’ve set up yourself.

But I think there’s a problem with this rule that isn’t addressed.

Problem:

The rule tells you what to do with your money. It doesn’t explain how to keep maintaining the rule to make it successful for you.

As we know, personal finance isn’t a one-size fits all approach, and that includes this pretty universal framework that we hear a lot.

Solution:

Address the psychological side with the same breakdown to make the rule work to your best advantage.

It takes 50% research*, 30% willpower*, and 20% intuition* to make money decisions.

• Whoa—ya’ll thought I’d leave you with just a cookie-cutter approach? Sub in the words that you feel best, this is just an example of a breakdown that makes sense to me now.

And, ta-da!

We’ve got strategy to use.

AND

We’ve got a way to do it.

So if you expand on the rule, you can now approach financial decisions within the 50–30–20 rule (did I just reach Inception status?).

Ex — for every “fun” purchase I make, I’m going to spend 50% of my time looking into my options, 30% willpower to not splurge on something that’s going to drain my bank account, and 20% intuition to decide on what feels right to have fun (this combats guilt).

Now that’s putting the 50–30–20 rule to work for YOU in an empowering way.

But, how can 50–30–20 be versatile?

So glad you’ve stuck with me. It’s what the title says after all.

That’s what you’ve come here for, not just the money talk gig.

And yes, the 50–30–20 rule can absolutely be versatile and not just related to personal finance.

Oftentimes goals are lofty.

They’re heavy.

They feel like they’re floating off into space.

How in the heck am I ever going to achieve this? (Yeah, I ask myself that a lot).

What I didn’t realize is that cutting through the clutter and setting three, doable breakdown categories is what I needed to get stuff done.

It wasn’t just the strategy.

It was the proper allocation to carry out the process, keep it in balance, then let it grow — without getting discouraged, or even worse, giving up.

I’m all about grasping simple frameworks and applying them to most parts of my life. Because for me, it gives a straightforward approach I can hold myself personally accountable for. Simple frameworks also complement nicely with self, team, employer, and family goals.

Now for the examples to put this into perspective.

In these examples I start with the prompt. List my created 50–30–20 framework. Then build out the tasks and to-do’s.

Family

We will be models for our daughter to show her all the choices that are available to her.

This is going to take 50% courage, 30% trade-offs, 20% asks to make it happen.

Sub-tasks:

• Courage includes making all decisions with her at the forefront, choosing time for yourself, and doing what it takes to share those options to her.
• Trade-offs include sitting things out to find time to recharge and be our best selves for her, saying “no” to make room for us when it makes sense, being somewhere at a given moment that will pay dividends in the future.
• Asks include reaching out to her support system — family, friends, colleagues, caregivers — when we can’t physically do everything ourselves, and posing the right questions to her pediatrician, future teachers, and specialists to open up her world however we can.

Self

Keep satisfying your growth-mindset to continue developing personally + professionally.

I need to merge 50% learning, 30% participation, and 20% recharge moments to make it happen.

Sub-tasks:

• Learning includes reading, attending community and industry-related events, creating content, exploring new hobbies and passions, and observing what’s around me.
• Participation includes raising my hand when the opportunities arise, signing up for experiences I’ve never been involved with, committing to showing up and being there.
• Recharge moments include utilizing the hours in the day that I have to myself or to connect with a loved one, resting when I can, working out, and taking deep breaths.

Career

Here’s our Q1 goals and the projects we’re going to take on to get there.

My projects are going to take 50% ideation, 30% review + audit, 20% optimization to make it happen.

Sub-tasks:

• Ideation includes brainstorming, connecting with the right team members, arranging the proper kick-off meetings, and research.
• Review + audit includes looking at past projects, running performance checks/data reporting, and using the results to make informed decisions to move forward.
• Optimization includes implementing new set-ups, running new A/B tests, lining up future performance checks, and looking at projects from a holistic perspective — not just one part of the system.

For the sake of not making this a ridiculously long post, there are three examples that I use the 50–30–20 rule in a versatile fashion for.

My challenge to you is to create your own 50–30–20 example:

1. Think of a goal in your personal life, career, business, family, etc. that you’ve been trying to take on for some time.
2. List that goal out.
3. Create your 50–30–20 framework that’s personalized to the goal— something that can feasibly breakdown what it takes for you to meet that goal.
4. List out the sub-tasks that correspond to the framework you’ve created.
5. Move forward with accomplishing that goal with the system you’ve created for yourself.

After your done, feel free to share your example! Leave a comment or you can connect with me on twitter @lysspowell.

Here’s to rules having versatility!