Use this 80/20 budget calculator to divide your monthly income using the 80/20 rule of budgeting.
80/20 Budget Calculator
Expense Amount (80%):
Savings Amount (20%):
What is a 80/20 Budget Calculator?
80/20 budget calculator is an online financial calculator which helps you to divide your monthly income using the 80/20 rule of budgeting. In this 80/20 budget, 80% of your income goes towards your monthly expenses and spendings, and 20% on savings. This is a very fruitful way to save money.
For example, Suppose your monthly income is $2500/Month. Then, using this 80/20 budgeting rule, you have $2000 (80% of $2500) for monthly expenses and $500 (20% of $2500) for savings.
What is the 80/20 Rule?
The 80/20 rule which is also known as ‘Pareto Principle’ states that 80% of your result generates from 20% of your work. This principle was developed by an Italian economist ‘Vilfredo Pareto’. He stated that “80% of consequences comes from 20% of causes“.
Since then, this pareto principle can be seen in many aspects of life. From productivity to finance, this rule applies to many fields.
How to Use the 80/20 Budget Calculator?
- Visit the 80/20 Budget Calculator page
- Enter your monthly income in the first input field
- Click on the ‘Calculate’ button to divide your monthly salary using the pareto principle
- The 80% (expenses) and 20% (savings) amount is shown to you in the output fields
- You can also use the ‘Reset’ button to reset the calculator
Use Cases of 80/20 Rule
- Business – In many businesses, majority of their revenue is generated from their small number of products. For example, in a cafe majority of their revenue comes from mainly a small portion of their products (mainly coffee and cakes).
- Investment – Many investors finds that their 20% of their holdings is responsible for their 80% of the portfolio growth.
- Workspace – In our day to day life, the 20% of the deep work which we do in our office is responsible for the 80% of the outcomes.
References
- Pareto Principle derived from ” Pareto principle – Wikipedia“
- Use Cases of 80/20 Rule derived from “How to Use the 80/20 Rule to Change Your Life – Refined Revelry (eringobler.com)“