The beauty of the rule is its simplicity. We humans are imperfect, and one of our greatest weaknesses is our tendency to bail when things get complicated or stressful. Sophisticated budgeting systems are complicated and stressful. Budgeting is something you must do your entire life. Find a way to simplify it.

There is no financial habit as important as saving. Unsurprisingly, it's also the hardest. Saving a little each paycheck can make things much easier when unexpected expenses come up. Whether you follow the 50/30/20 rule or not, you should make a goal to save a significant portion of your income for rainy days and retirement.

The former is hard because, with our money, we're optimists. What could go wrong? Retirement, on the other hand, is difficult because it can seem so distant. (Surely I can save for retirement when I get a better job, right?)

Set aside a portion of your income each month in a savings account to create an emergency fund. A savings account will psychologically earmark your money, making it less likely you'll withdraw it for spontaneous reasons. While your rainy day fund may require a little sacrifice now, it can be life saving if you're laid off from work or met with a sudden medical emergency. If disaster strikes, you can easily transfer the funds to a checking account to get you through.

One of the great secrets to saving is finding ways to make it automatic. Don't put yourself in the position of deciding how much to save with each paycheck. Make the savings decision once, and ride it as long as possible. Some employers, if they support direct deposit, will let you split your paycheck between accounts. This payment method is also a nice way to put money into a savings account automatically.

Like all budgeting methods, the 50/30/20 rule is not perfect, and shouldn't be applied as defined to every budget. Saving 20% is a huge improvement for some people. For others it's low. If you're a high income earner, for example, you should consider saving (and investing) much more than 20%, especially if you intend to travel. On the other hand, if you barely make ends meet (which is fine, we all go through it!), consider spending less than 30% on wants. Resist the temptation to compare yourself to others. Make adjustments. Place an emphasis on your long-term goals.

Note: The 50/30/20 rule is not appropriate for individuals who are in deep personal debt (unsecured debt). To avoid bankruptcy, a default, or long-term credit damage, dedicate as much of your income to paying off credit card balances and student loans as possible. Without neglecting your emergency fund, you may need something like a 75/5/20 rule until you've cleared your obligations.

The 50/30/20 rule is a simple, practical rule of thumb for individuals who struggle to budget. It offers guidelines for enjoying your income while putting savings on autopilot. Some folks will disagree, calling it too lenient or too strict. That's fine. Skilled budgeters and savers will develop their own habits and can be as disciplined as they like. But, if budgeting isn't natural to you—especially if you're young, and you've avoided deep debt—the 50/30/20 rule gives you permission to relax a bit and put savings on autopilot.