If you’ve ever felt overwhelmed by bills, savings goals, and the urge to invest, the 75‑15‑10 rule might be the answer. It’s a no‑nonsense way to divide every paycheck into three buckets: 75% for daily expenses, 15% for savings or debt pay‑down, and 10% for investments. No fancy spreadsheets, just a clear split that keeps your finances balanced.
Start with your net income – the amount after tax and any deductions. Take that number and multiply it by 0.75. That’s what you can spend on rent, groceries, transport, and the stuff you need to live. The next 15% goes straight into an emergency fund or toward paying down high‑interest debt. Finally, put the remaining 10% into a growth vehicle – a stocks & shares ISA, a low‑cost index fund, or even a regular savings account that earns decent interest.
Why does it work? By limiting discretionary spending to 75%, you avoid lifestyle creep. The 15% safety net builds a cushion that protects you from unexpected costs, while the 10% investment slice ensures your money keeps working for you. It’s a simple habit that creates three pillars of financial health.
Adjust the percentages if needed. If you’re living in a high‑cost city, 75% might not cover rent. In that case, try 70‑20‑10 or 65‑25‑10 until you get a stable footing. The key is to keep a dedicated savings and investment portion.
Automate the splits. Set up direct debits that move money into separate accounts on payday. Automation removes the guesswork and prevents you from spending the 15% or 10% before they’re allocated.
Choose the right investment. For the 10% slice, look for low‑fee, tax‑efficient options like a Stocks & Shares ISA or a diversified index fund. If you’re new to investing, start with a simple “buy‑and‑hold” approach and avoid high‑risk day‑trading.
Review quarterly. Life changes – a raise, a new lease, a baby on the way. Re‑calculate your percentages every three months to make sure the rule still fits your reality.
The 75‑15‑10 rule also pairs nicely with other budgeting ideas you might have seen on our site. For instance, the “Simple Basic Budget Setup” article breaks down a practical budget template you can plug the rule into. Or check out the “Best Budgeting Strategies for Financial Success in 2025” for deeper tactics on tracking spending.
Bottom line: you don’t need a finance degree to keep your money on track. Slice your income into 75‑15‑10, automate the process, and watch your financial picture improve month after month. Give it a try for a few pay periods and you’ll see where your money goes, where it’s saved, and how it grows.
Ready to start? Grab a pen, pull up your latest pay slip, and apply the rule today. Your future self will thank you for the simple habit that builds security, reduces debt, and puts money to work.
The 75-15-10 rule is a practical way to split your income for smarter budgeting. It suggests putting 75% to needs, 15% to wants, and 10% to savings or debt payments. This article breaks down how the rule works, where it comes from, and who it might help the most. You'll also find tips for making the numbers work in real life and common mistakes to avoid. If other budgeting methods have left you confused, this approach could be the refresher you need.
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