The 50/30/20 baseline
50% needs (rent, bills, groceries), 30% wants, 20% future. If 20% is impossible right now, save anything and increase it every time your income does.
Where the 20% goes
Build a 1-month emergency fund first, then a 3–6 month one.
Once the emergency fund exists, redirect most of the 20% into a low-cost index fund inside a tax-advantaged account.
Keep a small pot for near-term goals (holiday, laptop, deposit) so those don't derail the plan.
Key takeaways
- Aim for 20% of net income into future-you.
- Emergency fund first, then invest.
- Automate the transfer on payday — willpower is unreliable.