How Much Money Am I Spending?

“How much money am I spending,” is not only an important financial question to be asking yourself, but a crucial calculation when it comes to budgeting.  An itemization of your outgoing expenses will help you determine how much money you spend on living expenses compared to how much money you bring in each month or year.  It will also help you determine where you can save and how to plan for future expenses. Use this calculator to help you recall and itemize your living expenses.



How Much Do You Spend on Living Expenses?

Determining how much you spend on living costs and everything else can be eye-opening. Many of us don’t accurately recall how much we go through each month, and keeping track is important for a few reasons:

  • It helps you budget if you can see where money is going.
  • It can help you see if you are overspending.
  • It can help you see imbalances in your spending.
  • It can help you find areas where you can trim costs so you have more money for savings and important goals.

You should ideally be spending 50% or so of your after-tax dollars on your living expenses and necessities, including groceries, rent or mortgage, utilities and other needs. About 20% should be going toward your savings, and 30% is for discretionary costs.

Using a calculator can help you see if there are any concerns. If you are spending more than 30% on discretionary or fun activities such as shopping, you may not be saving enough or may be having trouble paying your bills.

How Much Money Can I Spend Each Month?

How much money you can spend each month depends on what you earn and on your obligations. Start by considering your take-home or after-tax pay. Then, make a list of things you need to pay for. This will include:

  • Groceries
  • Utilities and bills
  • Mortgage or rent
  • Insurance
  • Debt costs
  • Minimum payments on your credit card

Next, consider putting aside 20% toward debts and your savings. This is important to ensure you have enough money for emergencies and for retirement.

While you may want to maximize your savings and your retirement account, you will also want to have money to enjoy life right now. Plan for 30% to go toward things you want, such as:

  • Entertainment
  • Clothes
  • Going to the movies
  • Travel
  • Hobbies
  • Gym memberships
  • Free time
  • Vacations
  • Books and magazines
  • Subscriptions
  • Restaurant dining
  • Going out with friends
  • Gifts for the holidays
  • Home décor

While you don’t want to spend too much on this category, eliminating it entirely can backfire. Not having any “fun” money can make it harder to stick to a budget and can make your life seem dreary.

Carefully consider how much you can spend on this category in light of your necessities, debts and savings goals. If you have lots of credit card debt, for example, you might want to cut this category to 20% of your monthly income so you can pay down your card faster. Or, maybe you can find ways to save on necessities so you can pay down your cards and be able to afford evenings out.

Use the free and unbiased calculators at Money Help Center to see where your money goes and to create a budget that can help you get a handle on your expenses.