10 Recommended Category Percentages for Your Family Budget

Household and Personal Budget Guidelines

One of the most difficult things to do when setting up a family budget for the first time is to try and figure out how much you should spend in each category.  The whole purpose of a budget is to set you straight on your spending habits and bring them back into line, right? So there’s a couple of ways to go about getting your spending back in line:

1. Find Average spending percentages nationally, or

2. Track your spending and create percentages off what you already spend.

The Big Factors

The amount of money depends a lot on living factors like, where in the country you live, if you have small children, if your battling a medical condition, etc. Are you a married couple with no kids?  Then you’ll probably spend more on clothing and entertainment than a single mom with 3 kids. Studies have shown that lower income families spend a lot more money on food as a percentage of their overall budget that higher income families. We know that:

  • Spending varies by income level
  • Costs depend on family size
  • Costs also depend on location

So every family and individual is different.  There is no perfect combination.

The Category Average Percentages

National Average Budget Category Percentages of Net Income
Category Percent of Overall Spending
Housing (mortgage/rent, Real estate taxes) 24%
Utilities (water, power, garbage collection, 8%
Food 14%
Clothing 4%
Medical/Healthcare 6%
Donations/Gifts to Charity 4%
Savings and Insurance 9%
Entertainment and Recreation 5%
Transportation (car payments, gas, service) 14%
Personal/Debt Payments/Misc 12%

So that’s the average, based on statistics gathered from the US Bureau of Labor Statistics Consumer Expenditure Survey.  Since this is based on what people actually spend and it varies so much by family, location, I wouldn’t recommend relying on it heavily in forming your family budget categories.  So you ask, what should you be spending in each category to give yourself an edge in getting out of debt?  Here are some percentage guidelines from Dave Ramsey, financial guru:

Category Percentage of Overall Spending
Housing 25-35%
Utilities 5-10%
Transportation 10-15%
Healthcare 5-10%
Food 5-15%
Investments/Savings 5-10%
Debt Payments 5-10%
Charitable Giving 5-15%
Entertainment/Recreation 5-9%
Misc Personal 2-7%


Do you know how much cash you spent last month?

How to Get it Right

While no budget is the same, it’s important to start somewhere. Start with these guidelines (and that’s all they are) and tweak it to fit your needs.  But above all else you must spend ONLy what you bring in,  so don’t tweak it too much that you find yourself overspending again.  This is where I started and I found that I was able to bring our family food budget down significantly.  So I’m sure it’ll help in many areas of your budget as you find you can live on less.

More Help

There are a few products that I recommend that will help you form a budget and stick to it.  There’s nothing that brings more clarity to your finances that being able to see the big picture in one place and to be able to see what’s going on in each category of your budget.  Mvelopes is one of them.  It’ll help you set up your budget and give you easy control over it.

Also take a look at our free sample family budget template.  It’s gives you a place to lay out all your income and expenses to be able to see where your money is going.

Other excellent tools include You Need a Budget (YNAB), and Quicken Online (totally free).  Also check out my review of Quicken Online.

  • chris

    Why does no suggested budget ever mention child care.

    There is nothing more important.

    • Vern Ola

      Because you should be caring for your child yourself. Nothing is more important.

      • Mike

        How bout eatin’?

        • http://efewg BOB

          HAHALOL

  • Rob

    Hi Chris – according to Dave Ramsey’s Financial Peace book, page 295, regarding Work Sheet 5 (Budget), Child Support is listed under the Personal category.

    My question is… how can Dave Ramsey recommend the Saving category be 5 to 10% when Baby Step Four is to save 15% for retirement? He has Retirement Fund under the Saving category in Work Sheet 5 on page 293. Any ideas?

    • Brad

      Hi Rob – I think these are just general percentage guidelines based on Dave Ramsey’s Gazelle online budgeting tool. I think when you get to step 4, you will (should) be able to up the savings percentage to 15%.

      • ken

        this is based off of net income. most people have their 401k or retirement contributions taken out of gross income from their jobs. savings i think falls under the home/car repairs, vacations, emergency fund category. just my personal opinion and interpretation.

  • Pingback: how we dressed, lived and ate back in 1948–lesson 5a | stepping my way to bliss

  • Sarah

    Probably cause most parents can’t afford child care so one has to stay home! that’s how it is here…

  • Pingback: Step 6. Make a budget « suzewannabe

  • Dr. Satyapriya Rout

    What about education? I have seen many budget planners like this. And everyone forgets to mention about children’s education. In which category education comes?? I cant come under personal or life?? It should be mentioned as a separate category. Expenditure on education is a major portion of the income, especially when it is not state sponsored.

    • Brad

      Good question, but this budget is assuming the kids go to public school for free (here in the US) up until 12th grade (about 18 yrs of age). If you live in an area without free public education, or choose to pay for private school, the money should be carved out of other budgeted areas like savings, entertainment, or charitable giving.