Budget calculator

By:

James Knight

James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.

Updated:  Aug 9, 2024

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5 min read

Our budget calculator takes a large number of your financial details into account, then helps you budget your life effectively considering your current income. Keep reading to see how our budget calculator works.

How to use our budget calculator

Our budget calculator considers dozens of different factors, because managing our daily lives and finances requires many different considerations. That said, here are the most important steps when using our budget calculator:

1. Enter Monthly Income: Input your total monthly income in dollars.
2. Enter Housing Expenses: Input the amounts you spend on rent and mortgage.
3. Enter Utility Bills: Input the amounts you spend on water, gas, electricity, and internet.
4. Enter Living Expenses: Input the amounts you spend on groceries, transportation, entertainment, and any other miscellaneous expenses.
5. Calculate Budget: Click the “Calculate Budget” button to compute your total monthly expenses.
6. Review the Results: The calculator will display your total expenses and the remaining balance after deducting these expenses from your monthly income.

How the budget calculator works

Our budget calculator is a balance sheet that tallies up all of your income and all of your expenses, then determines whether your current financial situation leaves you in the black or in the red and helps you work out a better way to budget your income.

Why should I use it?

Everyday life can keep us busy. Between handling everyday expenses and managing unexpected ones, we may not realise how much money we need to have on hand to take care of all our individual and family needs. By using our budget calculator, you can create a budget that makes sure you’re not overextended yourself and falling into debt. This will help you make more responsible decisions, helping both your financial future and your peace of mind. You can combine it with some of our other trading tools, which you’ll find on this page.

What to consider when budgeting

Here are a few factors to consider when putting together a budget:

• Long-term goals. A few pounds one way or another per month might not matter much now. But if you’re actively working toward a goal (such as paying off credit card debt or saving for a big purchase), being more disciplined about what you spend gains importance.
• Stress. Some people can manage just fine mentally while dealing with debt, while others can become demoralised by it. If you fall into the latter group, it will make sense to cut back on spending so you can at least break even (or move ahead) every month.
• Extraordinary circumstances. Is your life filled with unusual circumstances that lead to big expenditures, such as an elderly relative or pet who keeps having major health setbacks that cost money to address? If so, you should create more wiggle room in your budget to account for that.
• Changing circumstances. Are you in a relationship and thinking about cohabitating with your partner? Or maybe you’re considering having your first child? These changing circumstances can have major effects on your financial situation, so make sure you budget accordingly.
• Age. When you’re younger, it can make sense to be more aggressive about budgeting, such as being more aggressive in how you invest with an eye toward future prosperity. On the other hand if you’re retired, you’re no longer receiving regular income and need to be more conservative in how you budget. Adjust accordingly based on your age.