How the budget calculator works
Enter your monthly take-home income (after tax) and your regular expenses. The calculator adds up your costs, subtracts them from your income, and shows whether you end the month with a surplus (money left over) or a deficit (spending more than you earn).
Surplus = Total income - Total expenses
Savings rate = Surplus / Total income x 100
A positive surplus is money available to save, invest, or pay down debt faster. A deficit means expenses exceed income and some category needs to be cut or income increased.
The 50/30/20 guideline
A common budgeting rule splits after-tax income into three buckets: 50% needs (housing, food, utilities, insurance, minimum debt payments), 30% wants (dining out, entertainment, subscriptions), and 20% savings and debt payoff. Use this as a starting point and adjust to your own goals.
Frequently asked questions
What is the 50/30/20 rule?
The 50/30/20 rule says to spend roughly 50% of after-tax income on needs (housing, food, utilities), 30% on wants (dining, entertainment, subscriptions), and 20% on savings and debt repayment. It is a starting guideline, not a strict rule.
What is a good savings rate?
Most financial planners suggest saving at least 15-20% of gross income for retirement alone. A 20% or higher overall savings rate (including emergency fund and debt payoff) puts you on a strong path.
How do I reduce my expenses?
Start by listing every expense for one month. Then sort them into needs and wants. Cancel unused subscriptions, reduce dining out, and renegotiate recurring bills like insurance and internet. Even small cuts compound over time.
Should I budget monthly or annually?
Monthly budgets match most billing cycles (rent, utilities, subscriptions) and are easiest to manage. For irregular expenses like car insurance or holidays, divide the annual cost by 12 and include it as a monthly line item.
How much should I spend on housing?
The standard guideline is to keep housing costs (rent or mortgage including insurance and tax) below 30% of gross income. Lower is better - the more you can spend on housing costs, the less you have for other goals.
Estimates only, not financial advice. Individual circumstances vary.