The 50/30/20 Rule: A Simple Way to Divide Income for Vietnamese Families

Managing money doesn't have to start with complex spreadsheets. The 50/30/20 rule — popularized by Senator Elizabeth Warren in "All Your Worth" — is a simple starting point that most families can apply right away this month.

How does the rule work?

Divide your monthly after-tax income into 3 categories:

Example: 25 million VND/month income

• Needs — maximum 12.5 million: rent 5 million, food 4 million, gas + utilities 1.5 million, children's tuition 2 million.
• Wants — maximum 7.5 million: weekend dining out, a trip home to the countryside, streaming subscription.
• Savings — at least 5 million: 3 million to emergency fund, 2 million extra principal payment on loan.

Adjustments for Vietnamese circumstances

The 50/30/20 ratio is a reference framework, not a law. Some common adjustments:

1. In big cities with high housing costs: if your needs category exceeds 50%, cut the wants category to 20% instead of cutting savings.
2. With dependent parents: monthly support for parents should be counted in the needs category.
3. Irregular income (business, freelance): calculate the ratio based on the average income from the last 6 months; any month that exceeds the average, put the excess straight into savings.

Where to start?

Track all expenses for 30 days (banking apps now provide automatic reports). Compare against the 50/30/20 framework to see where you're off track, then gradually adjust each category — improving 2–3% each month is good enough.

You can use [Sirifin's budget calculator](/vi/calculators) to quickly divide by your income, or ask the [AI advisor](/vi/ai-advisor) for suggestions tailored to your specific situation.

Content is for informational and financial education purposes, not investment advice.