Budget Calculator

How to Use This Calculator

Enter your monthly take-home income - the amount depositing into your bank account after taxes.

Include all income sources like side gigs, rental income, and child support. Count every dollar coming in monthly.

Check bank statements for exact amounts. Don't guess your spending - bank statements show actual amounts.

Convert annual expenses to monthly. Car insurance $1,200 per year = $100 per month. Do this for all yearly costs.

Enter what you actually spend, not what you wish you spent.

Compare your results to the 50/30/20 rule to find areas needing adjustment.

The 50/30/20 Budget Rule

Split after-tax income three ways: 50% for needs, 30% for wants, 20% for savings. Simple percentages that work at any income level.

Needs (50%)

Essential expenses you can't avoid - housing, utilities, groceries, transportation, insurance, minimum debt payments. If needs take more than 50%, you're financially stretched. Reduce housing costs, refinance debt, or earn more.

Wants (30%)

Non-essential spending that makes life enjoyable - dining out, entertainment, subscriptions, hobbies, vacation. If wants exceed 30%, cut back to create breathing room.

Savings (20%)

Emergency fund, retirement contributions, investments, extra debt payments. Saving under 20% means you're not preparing for emergencies or retirement.

When to Adjust

High-cost cities where housing takes 40%+ of income. Very low incomes where essentials take 70%+. High earners who can save 30-40%. Treat as starting point, not strict requirement.

Budget Management Tips

Track every dollar for 30 days to see where money actually goes.

• Small daily spending adds up. $5 every weekday = $1,300 yearly.
• Use cash for categories where you overspend. Pull cash for dining out - when it's gone, you're done.

Transfer money to savings on payday before spending anything else.

• Round up when budgeting expenses. Better to budget $210 and spend $190 than the reverse.
• Check spending weekly, not monthly. Small problems are easier to fix.
• Give every dollar a job. If you earned $5,000, decide where all $5,000 goes including savings.

Budget for irregular expenses monthly. Car insurance twice yearly? Set aside money every month.

• Each partner gets $50-100 monthly to spend with zero questions asked.
• Review budget with your partner monthly. Takes 30 minutes and prevents most fights.

Common Budget Mistakes

Guessing expenses: Budgeting $400 for groceries when you spend $600 means the budget fails immediately. Check 3 months of bank statements for real numbers.

Forgetting Annual Expenses

Car insurance, subscriptions, holiday gifts destroy budgets when they hit. Convert to monthly costs: $1,200 insurance ÷ 12 = $100 monthly. Budget the $100 every month, set it aside, pay when due.

Cutting too much too fast: Going from $800 dining out to $100 overnight usually fails. Cut by 25% each month. Gradual changes work, extreme cuts don't.

Creating a Budget Then Never Checking It

Making a budget then ignoring it is pointless. Track spending weekly using banking apps. Takes 5 minutes.

Zero budget for fun: Cutting every enjoyable expense leads to overspending later. Budget $100-200 monthly for guilt-free spending.

Never Updating

Got a raise? Had a baby? Moved? Update your budget. Review every 3 months or after major life events.

No emergency fund: Without savings, the first car repair goes on credit card. Build small emergency fund first.

Spending Every Raise

Got a raise? If you increase spending by the full amount, you're still living paycheck-to-paycheck. Split raises - half to savings, half to lifestyle.

Comparing to others: Budget for your goals and income, not someone else's life.

One person budgets, other spends: Both partners must agree on budget and follow it. Budget meetings prevent fights.

Quitting After Bad Month

Overspent this month? Get back on track next month. One bad month doesn't ruin progress - quitting does.

How Much to Spend by Category

Housing: 25-30%

Rent, mortgage, property tax, insurance, utilities, maintenance. Over 30% makes you house poor - sacrificing everything else. Under 25% gives breathing room.

What about transportation?

Target 15-20% for car payment, insurance, gas, maintenance, public transit. Car payments can be high for most incomes.

Food costs: 10-15%

Groceries and dining out combined. Many people overspend on restaurants. If food takes 20% of income, you're overspending on eating out.

Insurance: 10-25%

Health, life, disability coverage. Varies by situation. Employer coverage costs less. Self-employed or marketplace plans cost more. Medical emergencies without insurance cost tens of thousands.

Save at least 20%

Retirement, emergency fund, down payment savings. Under 20%? You're not saving enough. Aim for 25-30% if possible - helps you save faster. High earners should target 40%+.

Debt: 5-15% beyond housing

Credit cards, student loans, personal loans (mortgage already in housing). Over 15%? Debt is overwhelming. Under 5%? You're managing well.

Entertainment: 5-10%

Subscriptions, hobbies, clothing, personal care. Budget something for enjoyment. But 15%+? You're spending away your savings.

Zero-Based Budgeting

Give every dollar a job before the month starts. Income minus all assignments (expenses, savings, investments, debt) equals zero. Not because you spend everything, but because you decided where everything goes.

Example: Earn $5,000? Assign all $5,000 including $1,000 to savings.

The Process

List monthly income. List every expense. Assign remaining dollars to savings, debt payoff, or goals. Result: Income - Expenses - Savings = $0.

Money without an assignment disappears into random purchases. This forces decisions about every dollar in advance.

Who Benefits

People who feel money vanishes. High earners living paycheck-to-paycheck. Anyone wanting maximum control. Those aggressively paying off debt.

Monthly Budget Session

Before each month, sit down (with partner if you have one) and assign every dollar. Takes 30-60 minutes. Use budgeting apps or spreadsheets. Track actual spending throughout month and adjust as needed.

Ways to Cut Expenses

Housing (if over 30%)

• Refinance if mortgage rates dropped since you bought
• Get a roommate to split rent or mortgage
• Move to a cheaper area or smaller place
• Negotiate rent with landlord in exchange for longer lease
• Bundle home and auto insurance for discount

Transportation (if over 20%)

• Sell expensive car, buy reliable used one
• Carpool or take public transit a few days weekly
• Shop for cheaper car insurance annually
• Do basic maintenance yourself - oil changes, air filters
• Bike to work if distance allows

Food (if over 15%)

• Meal prep on weekends
• Reduce restaurant visits significantly
• Buy store brands instead of name brands
• Use grocery pickup to avoid impulse purchases
• Cook vegetarian meals more often
• Make coffee at home instead of buying daily

Subscriptions (if over 10%)

• Cancel unused subscriptions
• Rotate streaming services
• Use library for books and movies
• Find free activities - parks, hiking, free museum days
• Share subscriptions with family

Other Cuts

• Use cash for problem spending categories
• Wait 24 hours before buying anything over $50
• Buy used instead of new for most items
• Work out at home or outdoors instead of gym
• Negotiate bills annually with service providers

Ways to Increase Income

Request a Raise

Document accomplishments and research market rates for your role. Practice your pitch before the meeting.

Side Income Options

• Freelance your skills - writing, design, coding, consulting
• Gig economy work - food delivery, rideshare, grocery shopping services
• Tutoring in-person or online
• Rent spare room on short-term rental platforms
• Create and sell digital products - templates, courses, photos

Career Change

If you've maxed out earnings in your field, research higher-paying careers. Invest in certifications or training for roles that pay more.

Turn Hobbies Into Income

Photography skills? Shoot events. Good at crafts? Sell online. Fitness enthusiast? Get certified as trainer. Good writer? Freelance content.

Additional Income

Rent parking space, storage space, or equipment you own. Put savings in higher-yield accounts. Invest in dividend stocks for ongoing income.