Use this expense calculator to total your living expenses and show them as a percentage of your household income. It shows you:
- How much you spend for each category (food, clothing, etc.).
- What percent of your income goes to each category.
- Your total expenses relative to income.
- What percent of income is left for savings.
- How to apply the envelope strategy.
- Works for any time period (monthly, annually).
Just enter the income for the period you will be entering expenses for (monthly, annual) along with the name and amount for each expense category. The calculator does the rest.
This works great in tandem with the budget calculator to show how your spending compares with national averages and recommended percentages.
How To Track And Lower Your Expenses
Budgeting for monthly living expenses is a simple input-output equation.
A certain amount of money comes in – that’s your income. The amount you spend every month is your living expenses or outflow.
Plug these expenses into the Expense Calculator to determine if net savings results because money is left over, or debt results because you have more month than money.
The Expense Calculator makes this process easier by allowing you to organize your household expenses into categories and express them as a percentage of the monthly total.
Your objective is to plan your spending on a weekly or monthly basis so that you can stay within budget and build wealth through saving instead of building debt through spending.
Plan Your Living Expenses
The first step for managing your expenses is creating a proper plan for your estimated regular expenses. It’s important to put things down on paper or in a digital planner to keep track of what you will spend money on.
Second, make a list of your actual expenses so you know where your money is going. The reason people have so much trouble handling their expenses is because they have no idea what their expenses really are. If you are conscious about how you’re spending your money, you will see clearly how much money is going toward things you can do without and which expenses can be easily cut back.
Finally, allocate money for every expense. Some people use the envelope method for allocating money for each expense and some maintain separate accounts for drawing expenses. No matter how you do it, it’s important to find a system that works for you and stick to it.
Cut Your Monthly Expenses
If you find yourself with more month than money there are really only two solutions. You must either increase your income or reduce expenses until your budget balances. While both options are possible, most people find the latter is the quickest and easiest path to a balanced budget.
Start by organizing your expenses using this Expense Calculator. Identify which expenses are necessary and which ones you can live without. Then rank your expenses according to priority. It’s very important to prioritize your expenses from the highest priority to medium priority and then to low priority. Top priority expenses are necessities like rent, utilities, and food. Medium or low priority expenses are entertainment, magazine subscriptions, and anything unnecessary.
Get creative when looking to cut expenses. Look for ways to get greater value from your money rather than just trying to live without. For example, you can borrow a book from the library rather than buying it. This gives you the same value without paying a dime. Eat whole foods which are cheaper and more nutritious than processed foods. Wealth builders learn how to maximize the value they get from their actual expenses.
Sometimes the biggest budget impact can be made by changing just a few large-ticket living expenses. For example, do you really need your own two-bedroom apartment or could you find happiness sharing a place? Do you need your own car or would public transportation be just fine? Just a few changes to the largest monthly expenses can have a huge impact on how your budget calculates out.
If the Expense Calculator is showing that your budget problems are in the small expenses, don’t worry. One favorite strategy is to make a shopping list before you go to the store and stick to it. This is especially helpful to impulse buyers. A shopping list gives you a clear idea of what you truly need and eliminates unnecessary purchases. Without self-discipline, you can be tempted to buy things on credit and get into debt.
Coupled with the Budget Calculator, the Expense Calculator is a powerful tool that reveals where you’re overspending.
But it’s not enough to know where you’re overspending – you have to take action.
If you’re hesitant to start a budget, then start small. You don’t have to have everything figured out from the beginning.
Before you know it, you’ll have a working budget in place and save more money than you ever thought possible.
Expense Calculator Terms & Definitions
- Income – The amount of money you bring in weekly/monthly/annually.
- Expense – The cost you spend every week/month/year for your needs.
- Periodic Amount – The amount you spend each period for each type of expense.
- Expense Percentage – The percentage of the specific expense when compared to your total income
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- Budget Calculator: How much of my income should go to each expense category?
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- Compound Interest Calculator: How will my savings compound and grow over time?
- Cash Flow Calculator: How do I project all my irregular income and uneven expenses into a reliable cash flow projection?
- Present Value Calculator: What is the value today of a lump sum payment in the future?
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- Wage Calculator – Convert Salary To Hourly Pay: What does my salary equal in hourly pay – both real and nominal?