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.