# 80/20 Budget Calculator

## 80/20 Budget Calculator

80/20 Budget Calculator is an online finance tool which helps you to calculate your monthly budget on the basis of 80/20 budget rule.

You have to enter your monthly income in the calculator, then this program automatically calculates the savings (20%) and expenses (80%) part from your monthly income.

## What is an 80/20 Budget?

The 80/20 rule says you should first set aside 20% of your net income for savings and debt payments. The remaining 80% of the money is for spending (needs and wants).

## How to Calculate an 80/20 Budget?

To calculate the 80/20 budget, follow these steps:

1. Divide your take-home monthly income into two parts:-

2. First, calculate the 20% of your monthly salary, this should be used in your savings and debt repayment.

3. The leftover 80% is used for all of your needs.

Example 1: Calculate the 80/20 budget of John whose monthly income is \$1200.

John Monthly Income = \$1200

According to the 80/20 budget rule:

Savings = 20% of Monthly Income = 20% of \$1200

Expenses = 80% of Monthly Income = 80% of \$1200

Therefore, John Savings (20%) = \$240 and John Expenses (80%) = \$960.