How to Calculate How Much Income You Must Make

Use your monthly expenses to help you decide how much you need to make.

Use your monthly expenses to help you decide how much you need to make.

Major life changes, such as getting married or moving in together, can alter the amount of money you need each month to make ends meet. If you're moving into a larger house or apartment, the rent may not be the only thing that's more expensive; larger homes often mean larger utility bills as well. As you combine your lives, you also combine your debts, including student loans, credit cards and car payments. Look at your current financial needs as well as your savings goals to determine how much income you need.

Add up your expenses. Gather all your monthly bills, including mortgage or rent, car payment, insurance and utilities. Add up the totals from the most recent month. If you're moving to a new, larger home or buying a bigger car as part of your new lifestyle, add the new monthly costs and estimated utility expenses.

Calculate other necessary expenses, such as food, clothing, gas or transportation. Don't use the numbers you've budgeted for those items; use the actual amounts you spent. For example, if you budget $100 per week for groceries but go back several times for snacks, milk or other items you forgot, then you likely spend more than your budget without realizing it.

Figure out how much you typically spend on extra expenses like going to the movies, eating out and vacationing. Average these amounts from the past few months for a more accurate picture of what you spend. Decide together how important these entertainment items are in your budget, and raise or lower the amount accordingly.

Determine how much you want to put into savings and retirement accounts. If you contribute automatically through work, look at your check stubs to see how much goes into retirement savings each month. If your goal is to have three months' salary in savings, decide how much to put in each month to build that amount of cash in a reasonable amount of time. It's hard to put aside money for savings when you're just starting out, but even a small amount of savings can grow quickly if you start early.

Look at your pay stubs again to see how much you usually pay in taxes each month. If you typically pay more when you file your taxes, divide that number by 12 and add it to your monthly tax expenses. If you normally receive a tax refund, divide that number by 12 and subtract it from your monthly tax expenses. If you've never filed taxes together before, base this number off the amount you each pay monthly, as your joint tax return could be very different than your individual ones.

Add the totals together to come up with the amount of income you must make every month to pay your bills and meet your savings goals.


  • Once you add your expenses, you may find places you can cut to save money and require less income. For example, you can start clipping coupons to save on groceries or use public transportation to save on gas.

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About the Author

Based outside Atlanta, Ga., Shala Munroe has been writing and copy editing since 1995. Beginning her career at newspapers such as the "Marietta Daily Journal" and the "Atlanta Business Chronicle," she most recently worked in communications and management for several nonprofit organizations before purchasing a flower shop in 2006. She earned a BA in communications from Jacksonville State University.

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