Budget Calculator
Create a simple monthly budget.
Enter your income and expenses to see how much you can save each month and where your money goes.
How a monthly budget works:
A budget is the simplest and most powerful personal finance tool. It compares your total income against your total expenses to show whether you are saving money or overspending.
The formula:
Monthly Savings = Total Income − Total Expenses
The 50/30/20 rule (recommended budget split):
| Category | % of Income | What It Covers |
|---|---|---|
| Needs | 50% | Rent/mortgage, utilities, groceries, insurance, minimum debt payments |
| Wants | 30% | Dining out, entertainment, hobbies, subscriptions, shopping |
| Savings | 20% | Emergency fund, retirement, investments, extra debt payoff |
Worked example:
Monthly income: $4,000 after tax
- Needs (50%): $2,000 — rent $1,200, groceries $400, utilities $200, insurance $200
- Wants (30%): $1,200 — dining $300, entertainment $200, subscriptions $100, shopping $600
- Savings (20%): $800 — emergency fund $400, retirement $400
If your expenses exceed income:
- First cut wants — subscriptions, dining out, shopping
- Then reduce needs — cheaper housing, lower grocery bill, shop for better insurance rates
- Then increase income — side hustle, negotiate a raise, freelance work
Key tip: Track your actual spending for one month before making a budget. Most people are surprised where their money really goes — small daily purchases often add up to hundreds per month.
Emergency fund target: Save 3–6 months of essential expenses before investing. This protects you from unexpected job loss, medical bills, or car repairs.