If you make $500 a month, what should be your limit of monthly payments according to the 20-10 rule?

The 20-10 rule is a guideline for managing personal debt and financial health. According to this rule, an individual should limit their monthly debt payments to no more than 20% of their monthly income. Additionally, the total amount of unsecured debt (like credit cards) should not exceed 10% of their annual income.

In this scenario, if you are making $500 a month, you would calculate your limit for monthly payments by taking 20% of that amount. Twenty percent of $500 is $100. However, since the choices provided do not list $100, it’s likely that the question is looking for a more conservative approach to monthly payments, possibly related to specific budgeting strategies.

To find an acceptable monthly payment from the options listed, one would choose the amount that fits comfortably within the broader interpretation of the 20-10 rule. Among the choices, $50 represents a moderate level of debt payment that aligns with keeping financial obligations manageable, especially considering other living expenses.

Therefore, while $100 is technically the upper limit according to the 20-10 rule, $50 provides a practical balance for those seeking to maintain a healthy financial situation without overextending themselves. This makes $50 a reasonable answer while adhering to the