Budgeting doesn’t have to be overwhelming, but for many young professionals and students, it often feels that way. While some are discovering and embracing the 70/20/10 rule for its simplicity and balance, many others remain unaware of this practical approach to managing money.
This easy-to-follow financial rule is becoming the go-to framework recommended by local financial advisors and money coaches across the country. At its core, the rule suggests dividing your monthly income into three straightforward categories:
- 70% for living expenses,
- 20% for saving or investing,
- and 10% for giving or donations.
It’s not flashy, and it doesn’t require any apps or accounting degrees, just discipline and consistency. For young Ghanaians juggling rent, student loans, transportation, and family obligations, that simplicity is exactly why it works.
Making the Numbers Work
The idea is to dedicate 70% of what you earn toward everyday essentials: rent, food, electricity, water, transport, and any other recurring bills. This forces you to live within your means and avoid lifestyle inflation, the habit of increasing spending when income increases.
Then, 20% goes into the future. That could mean building an emergency fund, starting an investment in mutual funds or government bonds, or even contributing to a retirement account. For those just starting their careers, it’s a way to build financial resilience and escape the paycheck-to-paycheck cycle.
Finally, the remaining 10% is for giving, a nod to the deeply ingrained cultural and religious values in Ghanaian life. Whether it’s church tithes, supporting extended family, or charity, the rule makes space for generosity without compromising your financial stability.
Why It’s Catching On
The 70/20/10 approach is gaining ground among Ghanaian youth largely because it’s adaptable and realistic. Unlike complicated investment strategies or one-size-fits-all savings plans, this rule acknowledges that spending is necessary, but so is planning for the future and giving back to your community.
It’s also being promoted in workshops, personal finance podcasts, and social media platforms targeting Gen Z and millennial audiences. With youth unemployment still a concern and inflation impacting everyday purchases, more young people are turning to budgeting frameworks that are easy to apply to both formal and informal incomes.
Is It for Everyone?
No financial rule works for absolutely everyone. Some may need to tweak the formula, maybe 60/30/10 or even 50/30/20, depending on income stability, debt levels, or specific goals. But the idea remains the same: create a balance between spending, saving, and giving.
For freelancers or side-hustle warriors, the 70/20/10 rule also acts as a mental model, helping to allocate unpredictable income without falling into bad spending habits.
The 70/20/10 rule stands out as a smart and sustainable way to take control of your money. It’s not about being rich overnight, it’s about building habits that support your future, one paycheck at a time.
