On The Money's Budget Calculator Helps Guide Your Monthly Spending

On The Money’s budget calculator makes it easy to determine how much you should be spending across the seven categories that make up any responsible budget. Regardless of income, tracking and limiting your overall spending is a foolproof strategy for keeping your accounts in the black. Though the percents will vary according to geography and personal situation, On The Money’s calculator gives you a quick glance at concrete spending targets that you can compare against your credit card bills and bank statements. Give it a try and tell us in the comments what other tools you use to control your spending.

Budget Calculator [CNBC]

1. katbur2 says:

Interesting tool but the 11% for “everything else” including childcare? We pay \$650 a month for daycare for our three year old as well as \$300 a month for afterschool care. That’s in NC and it’s by no means the most expensive place in town. So that’s a nice theory.

2. humphrmi says:

Strange. I should be spending 10x as much as I am now for transportation, yet my housing (I’m assuming that means mortgage P&I, taxes and insurance) is on the dollar. And their food is way lower than mine (about half), but then we keep Kosher. I’m curious if “Savings” means retirement, college, and rainy day? That also seems a bit low to me.

• humphrmi says:

@humphrmi: DOH, well there was a little text below the graph that explained all my questions. Oh well, transportation still seems high and food and savings still seems low. Oh and I guess for food they only consider income, not how many kids you have ;-).

• ShortBus says:

@humphrmi: I also agree that it’s pretty useless. The general rule of thumb is to keep the PITI (principal, interest, taxes, insurance) on your house to less than 28% of your *gross* pay.

The difference between 28% of gross pay vs. 30% of net pay is pretty significant when most people kickback 25-30% of their income to the government.

3. goodcow says:

43.5% goes to rent, but then I live in NYC, so only 3.27% is necessary for transportation.

4. homerjay says:

This is worthless. There are so many variables in peoples lives that you simply can’t say “You should be paying X% for this and X% for that.”
My mortgage payment is already more than this X% tells me and my transportation expenses are FAR less. So now what does this tell me?

• B says:

@homerjay: You should move into a cheaper house and buy a new car?

• alexawesome says:

@homerjay: I agree. Likewise, we have a whopper of an expense every month: health insurance. We pay \$419 out of pocket. Yeah, that does suck. I agree, we shouldn’t have to pay that much. The fact is, we do. This chart is blissfully unaware of real-life expenses that affect many families. Likewise, I think allocating such a high percentage for transportation costs is kind of ridiculous. That IS the reality for many people, but it shouldn’t be that high. Thankfully, I only spend about a fifth of the suggested amount on transit. Good for me, but this doesn’t speak well of the majority of American’s.

5. runpete says:

This tool can be useful, but I find it rather useless. As homerjay said, the percents should not be fixed. I spend well over 30% of my monthly rent. Seriously, \$800 for rent? I would LOVE to find a place like that in Chicago. Granted, if I had a roommate, it would be more than doable.

I was a former Mint user. Their budget plan was great. It looked at your previous purchases, averaged out what you were doing, and set realistic budgets. Percents should be based on your spending habits over a period of time, not some “standard measure” the entire nation should use. For example, as I started to bike to work, my “Gas” budget went down and that money was added to the other categories.

Last note, my monthly take home is much lower than it should be. Before I get my paycheck, I automatically deduct: retirement, health care, savings, etc. So, this calculator doesn’t work that well for me. (Sure, I could just enter my pre-take home post-tax, but that would really throw off the percents.)

• Brunette Bookworm says:

@runpete: Yep, I know how you feel. I live in NW Indiana and while it’s cheaper than Chicago, unless I wanted to rent in Gary, no way I could get my housing down to 30%, unless they are talking pre-tax dollars. 30% of my take home pay after taxes, insurance and 401k wouldn’t cover a decent apartment in a safe neighborhood near my job.

The tool is a good place to start, but since expenses vary among people so much, it’s hard to say this is the ideal. I have no debt other than my car payment so I can take that money and put it somewhere else. I’ve used Pear Budget in the past, and found it easier to adjust to your personal needs.

• MoreFunThanToast says:

@runpete: 30% for rent even WITH a roommate is not realistic for me. Rent here is ridiculously high while its rather difficult to find even a decent paying job.

6. Beelzebubbles says:

I agree with katbur2; it’s hard to take this seriously without a category for child care figured in. Maybe they consider children “debt.”

7. TPK says:

11% for charity and childcare (plus including them among “miscellaneous expenses”) shows that the author of this tool is seriously out of touch with the average folks. Coming from CNBC, this isn’t particularly a surprise.

8. quirkyrachel says:

Yeah, this is below normal for housing costs in a city. I know what financial people say you’re supposed to spend on housing, but that doesn’t really work in real life in a city.

9. TPS Reporter says:

Totally out of touch figures. There is no way I could only spend on groceries what little this suggests. Transportation is right on and housing is way high. And as far as savings, don’t you know everyone has the ability to save 10%? You should, but should and can are 2 different things when you have kids.

• JustThatGuy3 says:

@MrBill38:

Weird, I found housing in line and transport way high! I could lease a Bentley and have cash left over for this allocation.

10. rpm773 says:

I think this chart is kind of pointless. Housing should be 30% of my net monthly income regardless if I’m bringing home \$2000 or \$6000?

• tange1 says:

@rpm773: I actually think that is true: Regardless of what you earn you shouldn’t spend much more than 30% on housing.

• crashfrog says:

@tange1: I’ve heard that figure over and over again, and it’s never seemed realistic.

11. sinrtb says:

I have to agree for me the housing came out about right but the household came out about 1/2 of actual and food came out way high. And transportation was just astronomical.

12. smallestmills says:

Um, mine was pretty close except food was off. I split rent 50/50 with b/f and there are no kids. I spend more on food, but that’s because I’m lazy. I could spend less and still eat well.

13. Sandtiger says:

I think you guys are missing the point. IMHO the objective of the tool isn’t to be a end all be all tool for every situation. Its to get people to start thinking about how much they spend and to put together a budget. Now I know for most people that monitor the consumerist thats not needed (after all EVERYONE that reads the consumerist is perfect *sarcasm*) but it’s purpose is well met in what it DOES do. I for one used this as a good guide to review my budget and adjust some. I won’t be eating out now and I will carry my lunches in so I can meet the guidance on food for a month. I found the tool very good for what its intended to do.

• roguemarvel says:

@Sandtiger:
I agree. This is a great tool to help give you a basic idea of where your money should go. When I first started budgeting I was at a loss of what would be good base percentages to start off with. I found a chart like this and modified it to my needs. I have all the percentages on an excel spreed sheet where I enter my paycheck and it breaks down how much I need to set aside for what. Then I use a separate program to keep track of how much money I have set aside for each category.

It’s not perfect since I sometimes over spend on food and entertainment or have unexpected expenses, but it makes me a lot more conscious of what I’m spending. It also helps me remember to set aside money for things I don’t always think about like gas and clothing.

14. newyorkcity says:

In my opinion, we should raise the savings from 10% to 15% or even more. Everyone knows that America is a debt nation and the gross populations averages more debt than saves. So why keep it equal? Savings is always something great to have for your future. Don’t just let is cancel out with the debt you have. Makes no sense at all….

15. RedmondDesomma says:

I’d love to only spend 30% of net on housing, but realistically I’m lucky to be only spending 60% of gross. Rental housing can be insane if you can’t abide roommates or filthy health hazards that would get condemned if anyone were willing to risk homelessness as the price of turning in their landlord. (Where I live vacancy rates are at 0.3% and the average rent has doubled since 2000. WTF?!?)

16. failurate says:

I’m a little over on housing, but way under on transportation and it appears I have been needlessly depriving myself of fancy food.

17. howie_in_az says:

According to this I should totally be driving a Porsche 911 and eating tons of fancy food since my both budgets are 2.5x what I’m currently spending.

Ironically the ‘food’ budget is, in real life, my savings budget.

18. Canino says:

If I spent the \$500 a month on food it says I should be spending I’d either be eating out every day or weight twice as much as I do…or maybe both. I spend maybe 1/2 that. Maybe.

19. mazda3jdm says:

I live in delaware and it tells me i should spent 650 a month on rent or mortgage. If i lived in a crack house or rented a cardboard box i could get it done for 650.

20. Etoiles says:

Another, “this tool has nothing to do with reality” voice in the crowd. The rent is only off by about \$75, but then again I only pay half of it. (Then again again, we picked this apartment based on both our incomes together.)

There’s nowhere in this plan for “obscene student loan repayments,” which is probably why the food, savings, transportation, household, and “other” categories all run high for me.

21. budgethacker says:

I cannot stand these simplistic pie charts that some finance websites have. The fact of the matter is that housing and rental costs vary by geographic area. Thirty percent may be reasonable in some areas but completely unrealistic in other higher cost areas such as Boston, New York City, and San Francisco. The percentages I have seen are as low as 25% to as high as 36%. We should strive to give each dollar a name before the month begins and then track against our budget on a regular basis.

On a side note, I find On the Money to be joke. The Dave Ramsey Show on Fox Business is much, much better and would love to see the Consumerist on it.

22. Joe says:

Has anyone noticed the size of the slices? Why is the “Debt” 10% slice TWICE as big as the “Savings” 10%? And why is the 11% Miscellaneous slice massively larger than them both?

• oneandone says:

@Joe: I just noticed that! Benefit of the doubt is that it’s an artifact of the 3D effect….. but I suspect it is a bit of manipulation. Or maybe it’s supposed to convey how those numbers actually feel. 10% going to pay off my debt feels a lot bigger than 10% going into savings :-(

23. stanner says:

I think it idea of using a pie chart to get a visual sense of where your money is going is a good one.

Just take your current budget numbers (you do have a budget don’t you?), put them into Excel and use the chart wizard to make that 3D pie chart. Presto – a pie chart that reflects your actual budget. It’s sure to get you laid, cause nothing is quite as sexy as a pie chart.

24. RStewie says:

My 7% “Household” doesn’t even cover my power bill, let alone upkeep, cable, internet, water, garbage, etc. Also, evidently I’m not spending enough on food. Maybe I should cut off the cable, the internet, etc, and spend that on food?

This is not a very realistic tool for the varied things we spend money on.

25. NYYSI says:

It is strange how people here don’t realize that some of the figures will make sense and some won’t, depending on where you live. It gives you a good idea of what you should be spending and saving, based on your income. Feel free to shift the percentages around where it makes most sense.

I won’t treat this like gospel, but it is interesting to see. For example, I live in NYC (Manhattan) so the housing is low. However, my only transportation fees are \$81 per month for a metrocard, so I can shift that money elsewhere. It isn’t brain surgery people.

@NYYSI: The point is that it doesn’t given anyone a good idea of anything since these percentages don’t work for anyone (so far).

If I have to adjust all the percentages, what the point of the pie chart that supposedly is telling me what percentages I should be spending on??

26. Jevia says:

Count me in with the majority that is spending more than 30% on housing, but far less on transportation. My food costs are lower, but debt costs more, when I add in my and my husband’s student loan payments. And the “misc” category is where I put in child care, which is far more than 11%, but this is ‘nicely’ offset by savings, which is no way near 10%. I feel happy if the \$200 I put in the savings account each month stays there.

Obviously geography, one income vs. two, children, and general lifestyle dictates that these pie divisions are pretty useless. If you aren’t living a ‘burb-y upper middle class lifestly, this doesn’t really work. Thing is, the overall is something to look at.

It suggests that you pay 69% of your income on fixed expenses: housing, utilities, food. Debt, savings, and the miscellaneous needs, depend on individual situations, so they parcel these out at 10% each. Now, I’d say it’s more vaulable to look at how much of your take-home you spend on fixed expenses, total, and adjust from there. If you have more than 31% percent of your income at your disposal, you’re ahead of the game, regardless of where it goes.

28. aedude01 says:

Yup, I’m calling BS on this tool too.

Living right next to DC my rent is way more than 30% of take home pay, but my transportation and food costs are WAY less, like \$100 a month for transportation, and food is like \$250 a month for me. Couple that with the fact that my place has all utilities (except for electric) included and this chart is way off base.

Besides I’ve always heard that your paycheck breakdown should looks something like this:

Gross Pay Before Taxes:
30% to the Gov’t including income tax, state tax, medicare and ss.

25-30% on Living expenses: rent, electric bill etc.

40% everything else.

29. DoubleEcho says:

I’m below all of the expense amounts they show on there, but the 11% on the Other Amounts doesn’t account for the \$520/month we pay for childcare for 2 kids (we get a discount because of our income from the YMCA). I think Mint is way better at showing me how much of my money I’m using, once you get all of the transactions categorized, and as long as you pay for most things with your check card or with a check. Otherwise, you’ll have to figure out what you did with all of those ATM withdrawals.

30. alice_bunnie says:

Transportation is WAY off for us… almost triple what we spend, and it’s not like we’re biking and bussing, either. :/ Food is low, but we eat out a bit, and we are a family of 6.

Housing 7% is about right, but we do budget billing for gas and electric. This also includes our cable bill, which we spring almost \$70 a month for. We could lose that if we ever hit a budget crunch.

31. pandroid says:

I spend less on housing, transportation, debt, and food than they say I should, and slightly more in household and everything else, and a lot more in savings. But most of the savings is retirement, so it’s not even like I feel like I’m getting ahead.

32. Cocotte says:

I started using a simple spreadsheet back when I was in college and trying to make sure my student loans would keep me fed until the summer. I printed it out and kept a copy in my pocket, and every time I wanted to spend money on something unnecessary I’d pull it out and say “see, if I buy this now I run out of money there.” I don’t use the printout anymore, but a decade later I still have the habit of living in the spreadsheet and using it to plan out paying off debts and putting money aside. It’s a way to set my financial goals and track them, and really satisfying to close off a column of debt.

33. booboolee says:

This chart was totally off my real spending and savings strategies. I make \$3000 a month after taxes, and save half of it. I have no debt, rarely drive (I work mostly from home, maybe spend \$100 a month on gas, hand me down car from my parents), and I share a shitty apt (but with all wood floors) with my boyfriend. I pay \$300 for rent. Clearly I am living under my means, but why shouldn’t I while I still can, while I have no children? My savings cushion is allowing me to rest easy about paying for my appendectomy, since my temporary emergency insurance only covers so much. I live in STL right now and it is very easy to live cheaply here.

34. opsomath says:

Useless tool is useless.

35. JeroldFlint says:

Between the two of you, who makes the least amount a month? How much more than \$950 does that person make? Is it really worth having that person work?

My wife and I looked at that and we figured that the \$200 a month extra that we made with her working was not worth it and decided that she would stay home to prevent the daycare expense.

36. QrazyQat says:

I’d like to call everyone’s attention to the graphic, the pie chart, because it’s a great example of bad and misleading graphics that you often see. Sometimes they’re used because the intention is to mislead, and sometimes just because it’s thought to be prettier.

Edward Tufte is a guy who talks about the visual display of quantitative information, in fact that’s the title of his most famous book. He points out how graphics are important, and very useful of properly done, in getting across facts, because we are good at absorbing info from visuals. But that also makes it easy to mislead even if the numerical info is provided. That’s what we see in this graphic.

Because the pie is on its side, in perspective, the parts toward the rear appear smaller than the parts toward the front. If you look at the furthest back section, housing costs, it looks as though it’s only a bit bigger than the ones next to it, even though it’s almost, or more, than twice as big numerically. So the numbers are there, but your brain tends to see it as a smaller bite than it is.

In this particular graphic there’s also an even worse problem. The sections for “food”, “debt”, “savings”, and “everything else” are all the wrong sizes. “Everything else”, at 11%, is far bigger than “food”, at 14%. “Debt” and “savings” are both 10%, yet “debt” is far bigger than “savings” in the graphic. This means that the picture you take away from this graphic is completely misleading, and because we tend to process visual info well, better than numerical info, the picture is what dominates our comprehension.

This could all be fixed by using a pie graph that’s on its edge rather than in perspective, and of course making the sections proportionate to their actual values.

I’m afraid in Prof. Tufte’s class this graphic would get a failing mark.

37. SnakesSolids says:

Yeah according to this thing my housing cost should be \$416. Anyone know where I can get a two-bedrooom
apartment for \$416?

Yeah, I didn’t think so either.

38. LatimerEmu says:

I find one of the most useful financial sites out there is http://www.sorted.org.nz – it is run by the government of New Zealand and has really excellent, friendly guidance and lots of calculators. It isn’t intimidating and doesn’t make you feel like you screwed up your life if you have some debt to pay off.

39. fisherstudios says:

This calculator is pretty much useless. It would be useful if we could set our own percentages for categories, etc.

As of right now, Spreadsheets > All.