Women have historically faced many struggles. Whether it is facing systemic violence and crime, suffering from abuse and harm, being seen as nothing more than cattle, no right to vote, no equality at work, women have had overcome a lot over the past few hundred years.

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International Women’s Day celebrates the achievements that have been made in the women’s rights movement while also highlighting the issues that still exist.

One of the existing issues is the lack of financial awareness and financial independence of women. A 2022 survey from Tata AIA Life Insurance found that 59 percent of working women relied on a male family member to make financial decisions for them. A shocking 89 percent of married women relied on their husbands to make financial decisions for them.

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Making financial decisions is not hard but the first step to financial independence. That’s where the 50:30:20 rule comes in. The rule is a simple budgeting principle that allows working women to build up their savings while still meeting their fiscal responsibilities.

The 50:30:20 rule suggests dividing your income into three categories -- necessities, discretionary expenses, and savings. According to the rule, 50 of your income should be allocated to necessary expenses that cannot be avoided. These include expenses like rent, electricity and utility bills, groceries, transportation, and more.

The second category constitutes things that you enjoy, like dining out, entertainment, travel, and hobbies. No more than 30 of your income should be spent on these expenses.

Finally, the remaining 20 percent of your income should be allocated towards building your savings and paying back any debts you have.

The rules are hard-and-fast but work as general guidelines that can help someone start budgeting their expenses and help them save. The rule aims to inculcate financial discipline and makes women prioritise their saving goals.

While the 50:30:20 rule is not a one-size-fits-all solution, it can be adjusted based on individual circumstances and financial goals. For example, if someone is saving for a future expense like buying a house then they can start saving 30 or 35 percent of their income and reduce discretionary expenses.

(Edited by : Sudarsanan Mani)