Budget Planner

Build a clear monthly budget to understand where your money goes and identify opportunities to save more each month.

The 50/30/20 Rule

A simple and widely used framework for budgeting:

• 50% of after-tax income toward needs (housing, groceries, utilities, transportation)
• 30% toward wants (dining out, entertainment, subscriptions, hobbies)
• 20% toward savings and debt repayment

Adjust these percentages based on your income level and financial goals.

How to Build Your Budget

1. Calculate your monthly take-home income — Include all sources after taxes
2. List all fixed expenses — Rent, mortgage, loan payments, insurance premiums
3. Estimate variable expenses — Groceries, gas, dining out, entertainment, clothing
4. Set savings goals — Emergency fund, retirement contributions, specific savings targets
5. Find the gap — If expenses exceed income, identify categories to reduce

Why Budgeting Matters

A budget gives you visibility and control over your money. Without tracking, it is easy to overspend in categories you do not consciously monitor. Even small, consistent improvements compound into significant financial progress over time.

Emergency Fund First

Before aggressively paying down debt or investing, build an emergency fund of 3-6 months of essential expenses. This prevents debt from growing when unexpected costs arise.

Frequently Asked Questions

How detailed should my budget be?

Detailed enough to be actionable, but not so granular it becomes overwhelming. Most people find 10-15 spending categories manageable and informative.

How often should I review my budget?

Review it monthly to compare actual spending to your plan. A quarterly review is useful for adjusting goals and categories.