So you've finally landed your first grown up job and are ready to live on your own. This is an exciting time in your life where you can have more freedom!

But wait...maybe this is too much independence. There are so many more expenses. And what about savings? How do adults do this?

The 50-30-20 method is here to help! Use it to build your "first time moving out" budget based on your needs and goals.

If you make the same amount of money every month, then this is easy!

However, many young adults are paid by the hour or earn most of their money through tips or commissions.

If your income after taxes changes from month to month, be sure to reevaluate how much money you're working with before you create your budget.

What do you spend your money on? Decide which of your expenses are needs or wants:

• Needs are things you can't live without.

• Wants are fun things that you can survive without.

Needs Examples

• rent or mortgage

• utilities (water, power, heat, etc.)

• groceries

• transportation (gas or bus fare)

• medicine or doctor's visits

Wants Examples

• restaurants

• shopping

• hobbies & activities

• TV or music subscriptions

• travel

Debt

It is also important to figure out what debts you need to pay off. Debts are any money that you've borrowed that you need to pay back. This includes credit card bills, student loans, or car payments.

Savings

If you don't have any debt or have extra money left over, you can use it for savings! You can save money in case of an emergency, or save up to buy things like a car or home.

This is where the 50-30-20 name starts to make sense.

• Needs — 50%: monthly income x 0.5 or monthly income ÷ 2

• Wants — 30%: monthly income x 0.3

• Debts & savings — 20%: monthly income x 0.2 or monthly income ÷ 5

Image courtesy of KindaFrugal

Use this online calculator to help you figure out your own expenses. You can also use the calculator app on your phone if you have one!

Now that you have your numbers, it is time to design your "first time moving out" budget! There are many platforms you can use to help you get started.

Printable Template

If you prefer paper, here is a free template to get you started.

Mobile App

Apps such as Mint and NerdWallet easily track of your budget at your fingertips.

Online Spreadsheet

If you prefer keeping track online, make a copy of this Google Sheets template.

Planner

There are many paper planner books out there for purchase that are designed for monthly budgeting.

Maria is a registered nurse who works hourly. She just moved into a new apartment on her own for the first time, and she wants to make a budget using the 50-30-20 method.

Here is Maria's "first time moving out" budget so far:

Use what you've learned in this Byte to make your own "first time moving out" budget!