# Where does my budget go?

Computes what is left of monthly take-home pay after spending and saving, and compares needs, wants and savings with the 50/30/20 rule.

- Page: https://www.acalculator.org/finance/budget-calculator
- JSON spec: https://www.acalculator.org/finance/budget-calculator.json
- Version: 350831b7be8b

## Default answer

Example with the default inputs (Take-home pay a month $5,000.00, Rent or mortgage $1,400.00, Utilities, phone and internet $250.00, Groceries and supplies $500.00, Transportation $400.00, Health and insurance $250.00, Childcare and education $0.00, Loan payments $200.00, Eating out and entertainment $300.00, Shopping and other $300.00, Savings and investments $400.00, Credit card and extra debt payments $0.00): On $5,000.00 of take-home pay a month, spending and saving $4,000.00 leaves $1,000.00.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| income | Take-home pay a month | Monthly income after tax and other paycheck deductions, from all sources. |
| housing | Rent or mortgage | Monthly rent or mortgage payment. |
| utilities | Utilities, phone and internet | Gas, water, electricity, phone and internet. |
| groceries | Groceries and supplies | Food and household supplies. |
| transport | Transportation | Car payment, fuel, insurance, parking and transit fares. |
| health | Health and insurance | Health costs and insurance premiums not taken from your paycheck. |
| childcare | Childcare and education | Childcare, school costs and tuition. |
| minDebt | Loan payments | Required monthly payments on student loans and other loans. Put credit card payments under debt payoff. |
| dining | Eating out and entertainment | Restaurants, takeout, outings and hobbies. |
| other | Shopping and other | Clothes, subscriptions, gifts, travel and everything else. |
| savings | Savings and investments | Money put into savings, an emergency fund or retirement accounts. |
| extraDebt | Credit card and extra debt payments | Credit card payments and anything paid above the minimum on other debts. The 50/30/20 rule counts these as savings. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| left | Left over each month | Take-home pay minus everything spent and saved. Negative means you spend more than you earn. |
| spending | Spending and saving | Needs plus wants plus savings and extra debt payments. |
| needs | Needs | Housing, utilities, groceries, transportation, health, childcare and minimum debt payments. |
| wants | Wants | Eating out, entertainment, shopping and other spending. |
| saved | Savings and debt payoff | Savings, investments, credit card payments and extra debt payments. |
| needsShare | Needs share (50/30/20 target: 50%) | Needs as a percent of take-home pay. |
| wantsShare | Wants share (target: 30%) | Wants as a percent of take-home pay. |
| savedShare | Savings share (target: 20%) | Savings and extra debt payments as a percent of take-home pay. |
| needsTarget | 50% for needs | Half of take-home pay: the 50/30/20 amount for needs. |
| wantsTarget | 30% for wants | 30% of take-home pay: the 50/30/20 amount for wants. |
| savedTarget | 20% for savings | 20% of take-home pay: the 50/30/20 amount for savings and extra debt payments. |

## Method

left over = take-home pay − (needs + wants + savings); each group’s share = group ÷ take-home pay × 100, compared with 50% needs, 30% wants and 20% savings.

## Assumptions

- All amounts are per month, and income is take-home pay (after tax), as the 50/30/20 rule uses.
- Needs are housing, utilities, groceries, transportation, health, childcare and required loan payments; wants are eating out, entertainment and other spending; savings include credit card payments and extra debt payments, as in All Your Worth.
- The 50/30/20 split is a rule of thumb from Elizabeth Warren and Amelia Warren Tyagi’s book All Your Worth, not an official standard.
- An empty spending box counts as $0.

## Worked examples

1. income = $4,200.00, housing = $1,300.00, utilities = $220.00, groceries = $450.00, transport = $350.00, health = $180.00, minDebt = $150.00, dining = $250.00, other = $200.00, savings = $500.00, extraDebt = $100.00 gives needs = $2,650.00, wants = $450.00, saved = $600.00, spending = $3,700.00, left = $500.00, needsShare = 63.095238%, wantsShare = 10.714286%, savedShare = 14.285714%, needsTarget = $2,100.00, wantsTarget = $1,260.00, savedTarget = $840.00. Source: CFPB monthly budget (income − spending); hand calculation in content.mdx.
2. income = $6,000.00, housing = $3,000.00, dining = $1,800.00, savings = $1,200.00 gives needsShare = 50%, wantsShare = 30%, savedShare = 20%, left = $0.00. Source: Warren and Warren Tyagi, All Your Worth (2005): 50% needs, 30% wants, 20% savings; hand calculation in content.mdx.
3. income = $3,000.00, housing = $1,800.00, groceries = $600.00, transport = $500.00, dining = $300.00 gives spending = $3,200.00, left = -$200.00, needsShare = 96.666667%. Source: CFPB monthly budget: expenses above income leave a shortfall; hand calculation in content.mdx.

## FAQ

### How do I make a monthly budget?

List your monthly take-home income, list your spending, and subtract the spending from the income. If the income is larger, you have money left to save or spend; if the spending is larger, look for expenses to cut. This is the method of the CFPB's monthly budget tool.

### What is the 50/30/20 rule?

A rule of thumb from Elizabeth Warren and Amelia Warren Tyagi's 2005 book All Your Worth: spend up to 50% of take-home pay on needs, 30% on wants, and put at least 20% into savings and paying off debt. On $6,000 a month that is $3,000, $1,800 and $1,200.

### Is the 50/30/20 rule based on gross or take-home pay?

Take-home pay: income after tax. Paycheck deductions for health insurance or retirement savings are already out of take-home pay, so do not count them again as spending.

### What counts as a need and what counts as a want?

Needs are the bills you must pay: housing, utilities, groceries, transportation to work, insurance, childcare and required loan payments. Wants are the rest of your spending: eating out, entertainment, travel, shopping and subscriptions. Savings include credit card payments and extra payments on debt.

### What if my needs are more than 50%?

Then there is less room for wants and savings. The rule is a guide, not a requirement. In a high-cost area, housing alone can take most of the 50%; the calculator shows your real split so you can decide where to adjust.

### What if I spend more than I earn?

The amount left over shows as negative. The CFPB suggests looking through your budget for expenses to cut, and a nonprofit financial counselor can help.

## Sources

- Consumer Financial Protection Bureau, Your Money, Your Goals: Monthly budget tool (list income, list spending, subtract spending from income). https://files.consumerfinance.gov/f/documents/cfpb_well-being_monthly-budget.pdf
- Warren, E., and Warren Tyagi, A. (2005). All Your Worth: The Ultimate Lifetime Money Plan. Free Press. (The Balanced Money Formula: 50% must-haves, 30% wants, 20% savings and debt payoff, from after-tax income.)