Put the rug on the horse, the rug should sit forward and in front of the wither. The top chest buckle should be fastened to the tightest or 2nd to last hole. If you are using the third hole or more, it may suggest the horse needs a larger rug size. The rug should sit firmly around the neckline and chest.
Leg straps should be loose enough to prevent chafing - but not
hanging down low. Surcingles should be adjusted so that they allow a hand's width between straps and belly.
Rugs that are too big tend to create more problems from rubbing and chaffing than rugs that are too small. If a rug is too big in the neck it will slip back behind the wither causing pressure on the withers and chest. This will cause more fabric to hang over the rear end of the horse and you will have issues with slippage and horses getting caught in surcingles and stepping on their rugs when getting up or rolling.The seam where the tail flap attaches to the rug should sit on top of the tail. If it sits beyond the tail, the rug is too big, if it sits up in front of the tail, the rug is too small.
In our experience combo rugs or rugs with fixed necks spell disaster. Even when lined with a mane saver they rub. Overtime the neck fabric begins to crease and combined with the inevitable build up of grease, the mane soon gets rubbed out. 
We always use a silky lined cotton sheet & seperate hood/neck cover under rugs as they can easily be washed and kept clean whch is the answer to preserving manes.
If you do use a hood when turning out do not use it with a fixed neck rug. This is the worst combination for rubbing manes and never leave it on overnight to dry out. You really will have very little mane left!