A budget is your financial roadmap. This calculator helps you track income versus expenses and compare against the proven 50/30/20 budgeting rule.
How This Calculator Works
> [!IMPORTANT] > The 50/30/20 Rule: Allocate 50% to needs, 30% to wants, and 20% to savings/debt. This simple framework works for most income levels.
This calculator analyzes:
- Total Income - All sources of take-home pay
- Needs (50%) - Housing, utilities, groceries, insurance
- Wants (30%) - Dining, entertainment, subscriptions
- Savings/Debt (20%) - Emergency fund, investments, extra debt payments
Budget Breakdown Example
Scenario: $5,000 Monthly Take-Home Pay
| Category | 50/30/20 Target | Your Budget | Status |
| Needs | $2,500 | $2,300 | ā
Under |
| Wants | $1,500 | $1,800 | ā ļø Over |
| Savings | $1,000 | $900 | ā ļø Under |
Frequently Asked Questions
What counts as a "need"?
Essential expenses you can't avoid: housing, utilities, basic groceries, transportation, insurance, minimum debt payments. If you couldn't function without it, it's a need.
What counts as a "want"?
Everything else: dining out, streaming services, gym memberships, vacations, hobbies. These enhance life but aren't survival essentials.
What if my needs exceed 50%?
In high cost-of-living areas, this is common. First, ensure you're minimizing needs (smaller apartment, used car). If still over, reduce wants proportionally.
Should I budget gross or net income?
Budget with net income (take-home pay). Your paycheck is what you actually have to work with after taxes and benefits are deducted.
How do I handle irregular income?
Use your average monthly income from the past 6-12 months. In high months, save extra; in low months, reduce wants.
Key Points to Remember
- Track every expense for at least one month first
- Be honest about needs vs wants
- Automate savings - pay yourself first
- Review monthly and adjust as needed
- Emergency fund first before investing