How to Budget 60K a Year

Sticking to a budget is hard no matter how much money you have.

Sticking to a budget is hard no matter how much money you have.

Planning a budget is challenging, whether you have 60K a year to work with or 600K a year. The national average wage was $41,673.83 a year in 2010. If your budget is $60,000, then you are a bit above average and might have more financial breathing room, depending upon where you live. A budget consists of both expected and unexpected items. A workable budget includes all of these elements and plans for a bit of fun and entertainment as well.

Items you will need

  • Budget worksheet

Download a budget worksheet from Kiplinger or Dave Ramsey's website. Using a worksheet ensures you don't miss important categories while planning your budget. A good worksheet plans for emergencies as well as monthly living costs and discretionary spending, such as nights out or vacations. It's never too early to start saving for retirement, so add that as an expense as well.

Figure out your net pay. You might make 60K a year, but that isn't what you'll bring home after taxes. Most people will net about 46K a year after taxes. Once you know how much you bring home on a monthly basis, it is easier to plan a budget. If there are leaner months when you do not earn as much as others, plan for that as well. Put money aside during the good months to add to the lean months. This will smooth out your income and make it easier to budget.

Fill in the lines that contain fixed expenses. These items include expenses like your monthly rent or mortgage payment, car payment, insurance, cable bill and Internet service. Fixed expenses do not vary in amount, but remain the same month after month. For most people, the biggest chunk if their 60K a year will go toward housing.

Estimate costs that vary from month to month. Some items are not always the same. For example, grocery bills, electricity bills, phone bills and fuel costs can vary from month to month. The easiest way to estimate is to look at the total cost for each item over the last year, then divide it by 12. This will give you a ballpark figure to work with for unfixed expenses.

On 60K a year, you should be able to take a vacation and put a bit aside for retirement. The amount you can put aside for these things depends on where you live. If you live in an expensive city such as New York or San Francisco, you won't have as much left over than you would living elsewhere. Add up the fixed and estimated other costs on the worksheet and see what is left. Don't forget to plan for items like new clothes, dining out and gift giving. Whatever is left is your vacation and savings funds. How you divide up those amounts is entirely up to you. Remember that putting money into an IRA can have tax advantages at the end of the year.


  • Make the budget stretch further by using coupons and looking for sales.
  • If you get a raise, pretend you are still making the same amount and save the extra money earned.

About the Author

Lori Soard has been a writer since 1995, covering a variety of topics for local newspapers and magazines such as "Woman's World." For five years, she served as a site editor for a large online information portal. Soard is also the author of several published books, both fiction and nonfiction.

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