Managing finances looked so easy in grade school with those cute pie charts sliced into brightly colored wedges. But, out in the real world, dividing up your paycheck into spending and saving requires some additional calculating and a bit of shuffling. While you won’t find a magic formula that sets out hard-and-fast rules for divvying up income, financial planners offer several possible ways to budget.

Housing Takes the Biggest Bite

Housing takes the largest amount out of your income. Common financial advice is to use no more than one-third of your paycheck for rent (or for mortgage payments, insurance and taxes if you own a home). After that, what you do with the rest depends on your situation. One popular paycheck allocation formula is:

  • 30 to 35 percent for housing
  • 10 to 20 percent for food
  • 10 to 20 percent for transportation
  • 5 to 10 percent for savings
  • 5 to 10 percent for debt repayment
  • The remainder for discretionary spending

The 50-30-20 Rule: Needs, Wants and Savings

Massachusetts Senator Elizabeth Warren’s budgeting guide is called the 50-30-20 rule, and some experts love it. The basic idea is to divide your paycheck into three categories: needs, wants and savings.

Spend half of your take-home income on things you need, like housing, transportation and food. Reserve another 30 percent for things you want — trips, clothes and entertainment. Use the remaining 20 percent to pay down debt or to sock away into savings and retirement funds.

General Rules for Budgeting

James McHale, a San Francisco CPA and Certified Financial Planner, says that precise formulas are difficult for people to apply to a budget. “Instead, I recommend that people follow several rules of thumb.” Three guidelines McHale suggests are:

  • Take 10 percent off the top for savings.
  • Keep consumer debt to 20 percent or less of take-home income.
  • Keep all debt to 36 percent of gross — before tax — income.

This means that if your monthly paycheck is $4,000 gross, or $3,000 after taxes, consider putting $400 into savings, limit consumer debt spending to $600, and keep total debt for the month, including your mortgage, to $1,440.

Your Circumstances Control Your Budget Allocation

Take your own circumstances into account as you work with these rules and guidelines. In some high-rent markets — like New York and San Francisco — your rent could take up far more of your allocation than the suggested 30 to 35 percent.

Some renters in Brooklyn, for example, hand over 60 percent of their take-home pay to landlords. And, if your student loan or credit card payments are sky-high, you’ll have to work that into your equation.

It Pays to Pay Yourself First

McHale suggests that regardless of the amount of debt you have, it’s important to pay yourself first by taking 10 percent off of the top of your paycheck for a retirement fund. “Starting to save early allows your savings to grow faster, thanks to compound interest over time,” he says.

“Ultimately, you reach your goals faster because you are getting interest on interest.” He also recommends that you take full advantage of any matching-funds programs your employer offers, like 401(k) investment plans.