# What is my disposable income?

Works out disposable income (income after income and payroll taxes) by year and by month, and, with spending, the saving and saving rate as the Bureau of Economic Analysis defines them.

- Page: https://www.acalculator.org/finance/disposable-income-calculator
- JSON spec: https://www.acalculator.org/finance/disposable-income-calculator.json
- Version: 12a7aec8d3fc

## Default answer

Example with the default inputs (Income before taxes $75,000.00, Federal income tax $6,000.00, State and local income tax $3,000.00, Social Security and Medicare tax $5,737.50): Income of $75,000.00 less $14,737.50 of taxes leaves disposable income of $60,262.50 ($5,021.88 a month).

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| income | Income before taxes | All income for the year before any tax: wages, self-employment, interest, benefits and so on. |
| fed | Federal income tax | The federal income tax for the year. |
| state | State and local income tax | State and city income taxes for the year. |
| fica | Social Security and Medicare tax | Payroll taxes taken from pay (7.65% of wages for most employees) or self-employment tax. |
| other | Other personal taxes | Other taxes on you or your personal property, such as vehicle taxes. |
| spend | Spending for the year | Everything you spend in the year, for the saving rate. Optional. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| disposable | Disposable income | Income before taxes − all the taxes. |
| taxes | Total taxes | The four tax boxes added up. |
| monthly | Per month | Disposable income ÷ 12. |
| taxRate | Share of income paid in tax | Total taxes ÷ income × 100. Shown when income is more than $0. |
| saving | Saving | Disposable income − spending. Shown when spending is typed. |
| savingRate | Saving rate | Saving ÷ disposable income × 100. Shown when spending is typed and disposable income is more than $0. |

## Method

Total taxes = federal income tax + state and local income tax + Social Security and Medicare tax + other personal taxes. Disposable income = income before taxes − total taxes. Saving = disposable income − spending. Saving rate = saving ÷ disposable income × 100.

## Assumptions

- All amounts are for the same year. Social Security and Medicare tax is subtracted, as the Bureau of Economic Analysis leaves social insurance contributions out of personal income.
- Spending includes interest paid and transfers, as personal outlays do.
- Arithmetic is exact on the typed decimals; money shows to the cent and rates to 2 decimals, halves rounded up.

## Worked examples

1. income = $75,000.00, fed = $6,000.00, state = $3,000.00, fica = $5,737.50, spend = $52,000.00 gives disposable = $60,262.50, taxes = $14,737.50, monthly = $5,021.88, taxRate = 19.65%, saving = $8,262.50, savingRate = 13.710848%. Source: U.S. Bureau of Economic Analysis, Disposable Personal Income (personal income minus personal current taxes), https://www.bea.gov/data/income-saving/disposable-personal-income; U.S. Bureau of Economic Analysis, Personal Saving Rate (personal saving as a percentage of disposable personal income), https://www.bea.gov/data/income-saving/personal-saving-rate.
2. income = $2,000.00, fed = $600.00, spend = $1,720.00 gives disposable = $1,400.00, taxes = $600.00, taxRate = 30%, saving = -$320.00, savingRate = -22.857143%. Source: OpenStax, Principles of Economics 3e, Appendix D, Table D2, The Consumption Function Before and After Taxes, https://openstax.org/books/principles-economics-3e/pages/d-the-expenditure-output-model: after-tax income $1,400, savings –$320.
3. income = $50,000.00, fed = $2,500.00, state = $1,200.00, fica = $3,825.00, other = $300.00 gives disposable = $42,175.00, taxes = $7,825.00, monthly = $3,514.58, taxRate = 15.65%. Source: U.S. Bureau of Economic Analysis, Disposable Personal Income (personal income minus personal current taxes), https://www.bea.gov/data/income-saving/disposable-personal-income.

## FAQ

### What is disposable income?

Disposable income is income after taxes: the money you have left to spend or save. The Bureau of Economic Analysis measures it for the whole country as personal income minus personal current taxes.

### How do I calculate disposable income?

Subtract all the taxes you pay on your income from the income: federal, state and local income tax, and Social Security and Medicare tax. $75,000 of income with $6,000 of federal tax, $3,000 of state tax and $5,737.50 of payroll tax leaves $60,262.50 a year, about $5,021.88 a month.

### Is disposable income the same as discretionary income?

No. Disposable income is what is left after taxes. Discretionary income is what is left after taxes and necessities such as housing, food and transport, so it is smaller. Student loan repayment plans use yet another definition based on the poverty guideline.

### Why are Social Security and Medicare taxes subtracted?

They come out of your pay before you can spend it. The Bureau of Economic Analysis subtracts contributions for government social insurance in arriving at personal income, so its disposable income is after them too.

### How is the saving rate calculated?

Saving is disposable income minus spending, and the saving rate is saving as a percent of disposable income, as the Bureau of Economic Analysis defines the personal saving rate. $60,262.50 of disposable income and $52,000 of spending is $8,262.50 saved, a 13.71% saving rate.

### Can saving be negative?

Yes, when you spend more than your disposable income, by drawing on savings or borrowing. In a textbook example, $2,000 of income with a 30% tax leaves $1,400, and spending $1,720 means saving −$320.

## Sources

- U.S. Bureau of Economic Analysis, Disposable Personal Income: after-tax income; personal income minus personal current taxes. https://www.bea.gov/data/income-saving/disposable-personal-income (retrieved 2026-10-19)
- U.S. Bureau of Economic Analysis, Personal Saving Rate: personal saving as a percentage of disposable personal income. https://www.bea.gov/data/income-saving/personal-saving-rate (retrieved 2026-10-19)
- U.S. Bureau of Economic Analysis, Glossary, Personal saving: personal income less the sum of personal outlays and personal current taxes. https://www.bea.gov/help/glossary/personal-saving (retrieved 2026-10-19)
- U.S. Bureau of Economic Analysis, Glossary, Personal income: income received by persons from all sources, less contributions for government social insurance. https://www.bea.gov/help/glossary/personal-income (retrieved 2026-10-19)
- OpenStax, Principles of Economics 3e, section 25.1, Aggregate Demand in Keynesian Analysis (take-home pay, also known as disposable income, is income after taxes), and Appendix D, Table D2 (income $2,000, taxes $600, after-tax income $1,400, consumption $1,720, savings −$320). https://openstax.org/books/principles-economics-3e/pages/d-the-expenditure-output-model (retrieved 2026-10-19)