How this calculator works
Start with your monthly take-home pay, after taxes and payroll deductions.
Needs are bills you must pay: housing, utilities, groceries, insurance, transport and minimum debt payments.
Wants are everything optional: eating out, travel, subscriptions and shopping.
What is left goes to savings, investing and extra debt payments; the target is 20%.
Worked example
$5,200 take-home, $2,900 needs, $1,300 wants
- Targets: $2,600 needs, $1,560 wants, $1,040 savings.
- Your needs are 56%, wants 25%.
- That leaves $1,000, or 19%, for savings.
Questions people ask
What if my needs are over 50%?
In high-cost areas that is common. Trim wants first, and look at the biggest needs, such as housing and transport, when you can.
Do retirement contributions count?
If they come out of your paycheck before take-home, you are already saving; many people count them toward the 20%.
Is 50/30/20 right for everyone?
It is a starting point. Someone paying off high-interest debt might aim for 50/20/30 with more going to debt.
How do I track spending?
Use your bank’s spending categories or a budgeting app for one month, then fill in the averages here.
Last reviewed October 2, 2026