When Your Money Pie Is Giving 130%… Let’s Talk

We’ve been talking about how income should be allocated — the 50/30/20 rule, needs vs. wants vs. savings, a foundational budget guideline.

You’ve seen that cute little “money pie” — the 50/30/20 chart that shows how your income should be split.

This is the recommended Money Mix.

And I invited you to use the Money Snapshot Calculator to see your own Money Mix (find the link to the calculator below).

And I already know some of my sisters are feeling some kind of way right now…

Because you put your numbers in, looked at your percentages, and had to face the fact that:

“Wait… my money pie is adding up to more than 100%.”

Meaning: you’re spending more than you make.

And listen — before you spiral:

This is extremely common. And it’s not just a young people problem.

A 2025 Debt.com survey found that one-third of Americans rely on credit cards to cover basic expenses. Among adults fifty and older, 17% use credit cards every month for living costs they don’t have cash for.

So trust me when I say this: You are not alone.

Plenty of people have money pies giving 120, 130, sometimes 150 percent or more. And yes, overspending can get worse if we don’t get a handle on it — but awareness is step one.

Today we’re going to talk about what it actually means when your pie is overbudget, why it happens, and what it reveals about your financial life — with relief, not shame or guilt.

Because facing your numbers is the beginning of fixing things, not the end of the world.

Understanding Your Numbers

Before we break down why your pie is overbudget, let’s acknowledge something important:

Most people’s real lives look nothing like this neat little pie chart.

These percentages are much more achievable when housing is affordable, debt is reasonable, income is steady, emergencies don’t happen, and life is not life-ing.

But that’s not the world we live in.

Housing costs are up dramatically. Goldman Sachs reports the U.S. is short 3–4 million housing units. Harvard’s Joint Center for Housing Studies says half of renters and nearly a quarter of homeowners spend more than 30% of their income on housing. And home prices have risen 55% since the pandemic.

Income isn’t stable for everyone — layoffs, caregiving, job changes, health issues all disrupt cash flow.

Emergencies absolutely happen — medical bills, car repairs, helping family, surprise expenses.

That’s real life. For a lot of people.

Which brings us to the heart of it: **Your Money Mix reflects your reality today — but it’s not written in stone.

Understanding the Culprits

For most people, three things push the money pie overbudget:

Debt — the weight you’re carrying

Lifestyle — the “nice-to-haves” that make life enjoyable

Habits — the patterns running on autopilot

These areas shape your Money Mix more than anything else.

The 20/10 Rule: The Weight of Debt

Debt often starts like this: prices are high, and you want or need something you don’t have the cash flow for right now… so you charge it and agree to pay interest for the convenience of having it today.

But debt is expensive.

The average credit card interest rate is now 22–24%, with many charging 29–30% or more. At those rates, your purchase ends up costing far more than the price tag.

Add inflation — like a movie ticket that used to cost $10–$12 now costing $18–$22 — and everyday life becomes even more expensive.

The 20/10 Rule is a debt-management guideline that shows what “manageable” debt looks like — not to shame you, but to illustrate why so many budgets collapse under debt.

The “20” Part:

Total consumer debt (excluding mortgage) should be under 20% of your annual take-home pay.

Example: If your net annual income is $80,000, your total non-mortgage debt ideally shouldn’t exceed $16,000 (because $80,000 × 20% = $16,000).

This includes your car note, credit cards, student loans, personal loans — every non-housing debt you have.

The “10” Part:

Monthly debt payments should be under 10% of your monthly take-home pay.

With $80,000 take-home income (≈$6,666/month), monthly debt payments should stay under ~$666 (because $6,666 × 10% ≈ $666).

Is this realistic today?

For a lot of people, no.

High prices alone can push you past the “20” limit — especially for necessities like cars. And high interest rates push you past the “10” limit.

That’s the point of sharing this rule: Debt can cause you to be overbudget very easily — even if you’re not overspending on purpose.

So what’s a girl to do?

This brings us to your habits.

Check Your Habits: The 80/20 Rule

The 80/20 rule (the Pareto Principle) says that 80% of your results come from 20% of your actions.

In your financial life, this means: A massive chunk of your overspending (the eighty percent) is likely coming from just a few specific habits (the twenty percent).

Habits run in the background like little apps on your phone — you barely notice them, but they drain your battery.

Examples:

A positive habit: Automating even a small transfer to savings builds cash flow you can invest later.

A negative habit: Swiping your debit card without tracking can lead to overspending… which leads to needing to use your credit card… which leads to increasing debt.

Small positive habits can completely transform your cash flow. And a shift in your habits will eventually shift your Money Mix.

So What Next?

Now you know your baseline — where you are right now.

Ask yourself: Is the way I allocate my income helping me build the financial life I want?

If the answer is yes — way to go, lovely.

If the answer is no — that’s okay. This is where you start building the life you do want.

Here’s how to read your percentages:

If your Needs slice is over 50%:

This often means high cost of living, high debt payments, or income that doesn’t match the cost of your life.

If your Wants slice is over 30%:

It may mean lifestyle spending is outpacing your cash flow — dining out, subscriptions, vacations, shopping for non-necessities, convenience spending.

If your Savings/Debt Reduction slice is under 20%:

Cash flow may be tight, or saving simply hasn’t been a priority yet.

If your pie adds up to more than 100%:

You’re spending more than you earn — extremely common. Often caused by relying on credit, high debt payments, bills that don’t fit your income, or habits running on autopilot that don’t serve your long-term goals.

First Things First: Get Out of Debt

If your pie is giving 120 or 130 percent, start here.

Make a Plan to Get Out of Debt

Debt eats cash flow.

Two Proven Payoff Methods:

Snowball Method: Pay off the smallest balance first — great for quick wins.

Avalanche Method: Pay off the highest interest rate first — saves the most money long-term.

Avalanche wins on math. Snowball wins on psychology. Consistency wins overall.

If debt feels overwhelming, a debt counselor may be able to help you map out a plan.

Consider Whether Downsizing Something Makes Sense

Downsizing doesn’t have to be drastic. It can simply mean choosing a slightly smaller version of your life while you rebuild cash flow.

This can look like:

Trimming recurring expenses — spacing out the weekly salon visit

Reevaluating subscriptions — choosing between Hulu and Prime

Choosing smaller experiences — a staycation instead of Europe

Negotiating bills with creditors — asking for a lower APR or payment plan

Switching providers to get a better deal — like moving to a lower-cost cell phone carrier

Temporarily reducing lifestyle costs — skipping a new leather coat because the one you have is still cute

The goal isn’t punishment. The goal is increasing cash flow so you can eventually invest, build wealth, and create the financial life that serves you.

Here’s the truth: The soft life you’re craving — the ease, the luxury, the freedom to choose — it requires a foundation. And sometimes building that foundation means making intentional choices now so you can live expansively later.

Think of it as strategic downsizing, not deprivation. You’re not giving up the life you want. You’re clearing the path to get there.

Your Reset

Now you know:

Where your money is going

What’s not working

And what you want

This is your starting point. Your reset.

You have a plan — whether you’re shifting habits, downsizing a few things, or mapping out a debt strategy.

You’re taking control of your money in a way most people never do.

Your money journey doesn’t have to be perfect. It just has to keep moving — with intention and consistency.

You’re building toward something beautiful. And you’re already on your way.

Money Snapshot Calculator

Friendly reminder: This is for education, not personal financial advice. Everyone’s money situation is different, and any decisions should be based on personal research or speaking with a licensed professional about your individual situation.