10-30-50 Rule Of Saving Money: Edelweiss Mutual Fund CEO Radhika Gupta has outlined a simple yet practical savings framework known as the 10-30-50 Rule, aimed at helping individuals build wealth gradually without giving up present-day comforts. The rule offers a flexible roadmap for saving that aligns with different income stages across life.
What Is The 10-30-50 Rule?
The idea is straightforward: save 10 per cent of your income in your 20s, increase it to 30 per cent in your 30s, and aim for 50 per cent from your 40s onwards. The approach recognises that earnings typically rise with experience, making it easier to save more as responsibilities and long-term goals grow.
Rather than pushing aggressive savings early on, the rule focuses on building discipline first and scaling up later.
How Savings Grow With Age
In your 20s, the focus is on forming the habit of saving. Even starting with 1–5 per cent is encouraged, as consistency matters more than the amount. The goal is to prioritise your “future self” while still enjoying life.
During your 30s, incomes usually improve through promotions or job changes. This is the phase to sharply increase savings to around 30 per cent, as expenses related to housing, marriage and family begin to rise.
In your 40s and beyond, when earnings often peak, the rule suggests saving up to half of your income. This phase is crucial for building retirement funds and meeting big-ticket goals such as children’s education.
Why The Rule Works
The 10-30-50 strategy strikes a balance between spending and saving, avoiding the extremes of rigid budgeting or unchecked lifestyle inflation. It adapts naturally to changing life stages and income levels.
A key element of the approach is automation. By using a Savings Deducted at Source (SDS) system, such as SIPs, fixed deposits or retirement plans, money is invested before it reaches your spending account. This reduces the temptation to overspend and ensures consistent wealth creation.
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