Average Budget Numbers and Our Percentages

Now that you’ve gone through the entire process that it takes to properly create a budget, the common question I get asked is ‘how much should you have budgeted for each particular category?’.

Today’s post is geared toward giving you some direction, but I will start by saying that this budget might not work for everybody. Your expected lifestyle and where you live have a lot to do with how your budget looks.

Somebody living in the midwest is going to have lower expenses than somebody living on the coast. Likewise, a family making $20,000/year is going to have a vastly different budget than somebody making $100,000/year.

The important part is understanding the principles I’ve discussed throughout this series and implenting them into your life.

The Average Budget

The budget I’ll detail is what I typically see in a 4-person family: 2 adults and 2 children. For sake of ease, I’ll assume the children are out of diapers and going to school (so there is no daycare cost).

*NOTE: The number on the left is what I typically see, the number on the right is what I’d recommend.
Monthly Take-Home Pay: $3,500 / $4,000

Giving: $0 / $400

Mortgage or Rent payment: $1,200 / $900-1000

  • House Maintenance, Repairs, Lawn Care: $0 / $25-50

Utility Bills

  • Electric: $135 / $135
  • Gas: $75 / $75
  • Water/Sewer/Trash: $55 / $55
  • Cell Phones: $180 / $120
  • Cable Television/Internet/Home Phone: $150 / $75

Household Expenses

  • Groceries: $400-600 / $400-480
  • Eating Out (dinners): $100-200 / $100
  • Lunches: $200-300 / $0 unless you have children that you pay to eat at school
  • Entertainment: $100-$200 / $50-75
  • Hygiene & Cleaning Supplies: $100 / $90
  • Hair cuts: $20-200 / $60
  • Clothing: $100-200 / $75-$125

Gifts (Christmas, birthdays, etc.): $100-200 / $50-75


  • Car Payments: $300-700 / $0
  • Gas for the car: $300-700 / $400
  • Car Repairs: $50-200 / This really depends on how new or old your cars are. If you have two cars with 75,000+ miles I recommend $150-200/month
  • Car Insurance: $100-200 / Again, this depends on car value, age of car, and whether or not you’re insurance a teenager. $100-150 is reasonable for fully-covered vehicles.
  • Car Tags/Registration/Propery Taxes: $20-100 / $20-50

Life Insurance: $0 / $100

Medications/Co-pays/Dental/Vision: $0 / $50-75.

This doesn’t include health insurance as I’m assuming that’s being taken out of your paycheck. This is just an extra amount to save in the non-monthly account to cover “life” when it happens and to cover normal doctor/dental visits.

Blow Money (Spending $$ for married couples): $0 / $100 ($50/each)

Children’s Activities: $75-100 / $25-$50


In the average American’s scenario I find that eating out, lunches, cable television, cell phones, and car payments are the things that are hindering their ability to make ends-meet.

The reason why the normal American family is able to pay their monthly bills (and doesn’t see a negative $260 budget) is because they don’t save for the Non-Monthly expenses that I have listed.

Most people don’t save for house upkeep, gifts, car repairs, car tags/registration/tax, medical expenses, or childrens’ activities. So if we took those things out of the budget, then they’d have some sort of disposable income. However, when those expenses come due (because they’re not a matter of if, but when) they’d have to go into debt to cover them.

In my scenario I did increase income (which obviously makes things easier), but I also added giving, life insurance, and medical expenses, WHILE ALSO being able to fit in all of the non-monthly expenses and still maintaining a disposable income.


The budget above just discusses the 4-Walls and it doesn’t include any debt. I racked my brain trying to figure out how to detail what I normally see when it comes to debt but I came to one conclusion: there is no “normal” or “average.”

All I know is that everybody has debt: student loans, medical bills, payday loans, credit cards, personal loans, lines of credit, etc. So instead of listing all of the various types, I think just an average monthly payment amount would suffice.

Average Monthly Debt Payment: $300-700 / $0

In the scenario I recommended above, a family could still do everything I detailed while also covering $300/month in debt payments. Furthermore, they’d have $145 in true disposable income!

Sure, their “additional” progress would be limited, but they’d still be able to cover all of their bills/lifestyle expenses every month, save for expenses that would be coming up throughout the year, and also make some extra progress on their debt.

The Percentages for our Budget

Our percentages

5 years ago my personal budget looked nothing like what it does now.

There were many rough days and a lot of stubbornness that had to be broken. We’ve had our monthly disposable income be as little as $10 for awhile.

Over time however, that started to change. Financial peace and success led to more sacrifice which in turn led to greater success and change.

I will state that there is ZERO chance our budget would succeed if we had car payments.

Eliminating cable (added Netflix) and canceling our internet on our cell phones also enabled us to start making ends-meet.

In addition, our behavior change over time and our ability to limit gifts ($40/month), eating out/entertainment ($90/month), clothing ($50/month), and groceries ($280/month) has allowed us to get a grasp on our financial lives and pay down debt while also preparing for future expenses.

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About the Author

By , on Feb 16, 2012
Andy Tenton
Andy is a 30-something New Yorker who turned his financial life around. He took charge of his finances, got out of debt, and is now working his way toward financial success. He is the publisher of WorkSaveLive.com.

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  1. Lisa Wilson says:

    Make one of those budget charts with $1,200 a month bring home. It’s a lot harder to do.I know hardly anyone who makes the kind of money you chart for. If you were doing for $1,200 income what would it look like? Make one up & i’l compare it to a rel one for that amount. Then I’ll show you ours.Thanks, lisa

    • Andy says:

      Hi Lisa!

      I’ve coached a couple of clients that made minimum wage and others with low incomes (granted, none of them had children).

      All I know is that it’s extremely difficult to coach somebody through that. There is assistance via food stamps and housing…just depends on income, children, and the area of the country that you live.

      Also, there was a reason I walked through the entire 6-week budgeting series and it was in large part because there is no easy answer when it comes to budgeting on a small income.

      I’d encourage you to check out Part 4 and work on developing a long-term game plan on increasing income and a short-term fix to bridge the gap in time. I know…it’s not easy, but the fact is that there are two sides to the financial equation: income and out-go.

      The only way I’ve seen a person/family survive with $1200/month income is by renting extremely cheap (typically having a roommate in an apartment if you’re single), no debt at all (including cars), and everything else was bare-bones (i.e. no eating out, cable, internet, or fancy cell phones). Depending on if you’re single or have children, I’ve seen a single person eat on $80-100/month. If you have small children WIC may also be available.

      I know that doesn’t provide much assistance and I certainly wish I could give you a better answer. I would just encourage you to work on the income side of things as much as possible. A great book to read is 48 Days to the Work You Love by Dan Miller. He gives some practical insights on finding a job you love to do and how to go about applying for jobs (that is unique from everybody else).

  2. Savvy Scot says:

    Unfortunately living in London, our mortgage is a third of our income 🙁

    • Andy says:


      Yeah…that will do it. 1/3 isn’t aweful though. Remind me to tell my wife that the next time she wants to move to Europe. 🙂

      Here in the midwestern US, I like to see people’s rent/mortgage around 20-25% of their take-home pay. On the coasts I don’t think it’s terrible if it is 30-35%.

      Anything above that though and you’re really just becoming house poor and it becomes very difficult to survive.

  3. AutumninWI says:

    Excellent guidelines, and something that many financial advisors don’t really address. We’re a family of 4 with 2 school age kids and I’m happy to report that we fit right in your suggested amounts. We’ve also cut eating out and entertainment to nearly zero while we pay off debt.

    • Andy says:


      That is wonderful!

      I’ll have to admit that our journey has taken so long that I couldn’t go without eating out/entertainment any longer. lol. However, for the first year and a half we didn’t do any eating out.

      Great for you though (and your discipline)…keep up the excellent work! I love to see responsible parents that are being great examples for their children!

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