Calculate Your Spending and Savings Plan

When creating a budget, knowing how much money to put toward which expenses can be challenging. Yet, having a plan helps you make better overall spending decisions. One way you can do this is through the 50/30/20 rule. With this method, 50% of your income goes towards the things you need, 30% goes towards things you want, and you tuck that final 20% into savings. Here's how it works.

  • 50% Needs. The first 50% of your income goes towards necessary purchases, which you must pay for the necessities of life. Things that go into the "Needs" category are items you must have to continue to meet your basic physiological requirements. That excludes things you consider 'essential,' such as your morning coffee shop run or favorite streaming service. If you are spending more than 50% on your needs already, you'll need to find a way to reduce them or increase your income. Finding ways to trim back your needs is always a good idea, but do so wisely, recognizing that paying for your needs is typically more important than funding "Wants."
  • 30% Wants. The second step is putting 30% of your income towards your desired things. It includes those coffee shop purchases, streaming services, or dining out. It also includes clothing purchases, electronics, and other items you want to spend money on. When making buying decisions, focus on this figure. For example, if you are considering buying a new car, be sure that the added car payment for the higher-end vehicle (the more expensive model) fits within your 30% goal. If it doesn't, choose a more affordable model.
  • 20% Savings. Put 20% of your income into your savings each month as well. That can include traditional savings accounts and investments like retirement accounts and mutual funds. It can seem like a steep amount to save, but your savings help reduce the risk of not having money available during an emergency or when it's time to retire. It can also help you save up for goals like buying a home.

This calculator will help you create a budget that falls within the 50/30/20 guidelines. You'll first identify your income and identify fixed and variable expenses that fit within your "Needs." You must also budget savings to have a financial safety net and funds for future investments, emergencies, or unplanned opportunities.

What you'll have left is for discretionary expenses, or the 30% "Wants" that you can decide how to spend. Try to get your budget as much in line with the 50/30/20 rule.

Turning on "Power Mode" will display the results of the calculations alongside the input fields. When "Power Mode" is off, descriptive information sits alongside the input fields for a more informative learning experience.
Monthly Income
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A salary is a fixed regular payment provided by an employer, typically paid on a monthly or biweekly basis, but often expressed as an annual sum.
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An hourly wage is the fixed amount of money an employer pays an employee for each hour worked. Total hourly wages are based on the total number of hours employees worked during a given pay period, times their hourly wage.
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Tips, bonuses, and commissions are forms of additional compensation for employees. Tips are usually discretionary amounts given by clients, bonuses are extra payments awarded for meeting or surpassing specific goals, and commissions are a percentage of sales revenue the salesperson earns.
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Freelance & gig work work refers to temporary and flexible jobs as independent contractors rather than traditional employees. Pay is typically by assignment, project, task, or hour, without receiving the benefits granted to full-time employees.
Monthly Fixed Expenses
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Housing expenses refer to the costs associated with owning, renting, or maintaining a residence. These can include mortgage or rent payments, property taxes, utilities, maintenance, and insurance.
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Insurance expenses are the premiums paid for coverage against specific risks, such as health issues, accidents, property damage, or life events. These payments provide financial protection or compensation when covered events occur.
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Phone expenses refer to the costs associated with owning and using a phone, including monthly service plans, equipment purchases, and any related fees or charges. They can encompass both mobile and landline telephone services.
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Internet, cable, and streaming expenses are associated with accessing online services, television channels, and digital content platforms. These fees cover monthly subscriptions, equipment rentals, or one-time payments for specific content or services.
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Sewer and trash expenses pertain to wastewater treatment and garbage collection services. These fees ensure the proper disposal of waste and maintenance of sanitation standards in a community or property..
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Other is the monthly amount paid for fixed expenses not listed above.

Monthly Variable Expenses
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Utilities refer to the regular costs associated with essential services such as electricity, gas, water, and sometimes heating. These bills vary based on consumption and are typically paid monthly to service providers.
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Grocery expenses refer to the cost of purchasing food and other household items from supermarkets or stores. These costs vary based on consumption habits, preferences, and shopping frequency.
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Transportation expenses encompass the costs of commuting and traveling, including fuel, public transit fares, and vehicle maintenance. These outlays can fluctuate based on travel habits and the mode of transportation used.
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Other variable expenses in a monthly household budget refer to costs that fluctuate month-to-month and don't fit into typically defined categories, such as unexpected repairs or occasional expenditures. These unpredictable costs aren't routine but can arise and impact the budget.
Monthly Savings Contributions
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General savings refers to the portion of income set aside for future use rather than immediate expenditures. It is money put aside for general use, such as payments for future purchases or investments
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Emergency savings refers to funds reserved to cover unexpected financial hardships, such as medical emergencies, job loss, or urgent repairs. This fund provides financial security, ensuring that unplanned events don't disrupt one's financial stability.
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Retirement savings are the income saved for post-work years, ensuring financial stability in retirement. It might include contributions to retirement accounts like 401(k)s, IRAs, or other pension plans.

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Monthly Income & Expenses

Budget Categorized by Expense
Actual Budget 50/30/20 Budget
Monthly Income
Total Expenses
Disposable Income
Savings Contributions

Following the 50/30/20 budgeting method of categorizing income into three main sections: 50% for needs, 30% for wants, and 20% for savings or debt repayment provides a simple framework for individuals to track and allocate their spending. Its emphasis on distinguishing essential expenses from personal desires ensures individuals live within their means, while the dedicated savings or debt repayment portion promotes financial security and responsibility. Adaptable to various income levels and life circumstances, the 50/30/20 method provides a structured and flexible approach to achieving financial well-being.