A budget is the basis of your financial stability. Making a 50-30-20 monthly personal budget is a smart habit to get into when managing your money well. It is useful to keep track of various revenue sources and spending categories. It is beneficial to cut out all unnecessary spending by creating a **personal monthly budget** at the beginning of the month. Here, we will take you through **6** easy and quick steps for creating a 50-30-20 budget spreadsheet in Excel.

**Table of Contents**hide

## Download Practice Workbook

You may download the following Excel workbook for a better understanding and to practice yourself.

## What Is the 50-30-20 Budget?

The 50-30-20 budget is a fantastic basic budgeting method that offers advice on how much to set aside each month for certain expenses. Elizabeth Warren popularized it in her book **All Your Worth: The Ultimate Lifetime Money Plan**. A simple guideline that makes it easy for you to take charge of your finances is the 50/30/20 budget scheme. Here, you spend 50% of your income on the most important expenses (e.g. food, rent, utility bills). 30% of the budget is allocated to desirable items. The remaining 20% is then used for savings or debt repayment.

## Why Is the 50-30-20 Budget Important?

At first, we’ll talk about why the budget is important. Because it always reminds us to spend less than our earnings. Taking charge of your finances is a life insurance policy against unforeseen events and a career booster.

Now, let’s come to the matter of why the 50-30-20 budget is important. Because this budget scheme is ideal for people who prefer simplicity. This spending plan is suitable for families, young professionals, and college students equally. It is ideal for those who are new to budgeting. Also, you can set a goal for spending on each category at the start of the month.

## 6 Steps to Create a 50-30-20 Budget Spreadsheet in Excel

Creating a 50-30-20 budget in Excel could seem challenging at first, especially if you don’t use the application frequently. No matter how simple or complex the budgeting is, this step-by-step article will show you how to create a 50-30-20 budget in an Excel spreadsheet that can be easily customized to meet your needs. Excel includes a huge selection of budgeting templates. But in this article, we will create a 50-30-20 budget spreadsheet in Excel from scratch. So, let’s follow the steps to making a 50-30-20 monthly budget spreadsheet.

Here, we have used the *Microsoft Excel 365* version, you may use any other version according to your convenience.

### Step 01: Calculate Monthly Income

At the very beginning, we’ve to make an income section where the total monthly income will be mentioned. It’s simple and easy. Just follow along.

**📌**** Steps:**

- At first, we created a column for sources of income in the
**B5:B8**range. In this case, the income sources are mainly office salary, overtime pay, additional income, and others. - Then, we inserted a new column for the amount under
**Column C**.

- After that, we calculated the
**Total Budget**from the incomes. - To do this, select cell
**C9**and enter the following formula.

`=SUM(C5:C8)`

Here, **C5:C8** represents the range of amounts for several types of income sources.

- Then, press
**ENTER**.

**Read More:** **How to Do Budgeting and Forecasting in Excel (2 Suitable Ways)**

### Step 02: Determine Ideal 50-30-20 Division

As we stated before, for a 50-30-20 budget, 50% of the total budget goes to needs. 30% for wants and another 20% is used for savings. Now, we’ll determine the amount of each of these 3 parts. Let’s see it in action.

- Firstly, go to cell
**F5**and write down the following formula in the**Formula Bar**.

`=C9*0.5`

Since the need is 50% of the total income, we multiplied the **Total Budget** in cell **C9** by **0.5**.

- Then, press the
**ENTER**key.

**Similarly**, work out the ideal amount of**Wants**and**Savings**.- Here, take the multiplier as
**0.3**to calculate the amount of**Wants**. - Additionally, take
**0.2**for**Savings**.

**Read More:**** How to Make a Household Budget in Excel (2 Smart Ways)**

### Step 03: Compute Expenses in 3 Different Categories

In this section, we’ll calculate the **Needs**, **Wants,** and **Savings** separately. We’ll determine them from various expense sectors. Instead of looking around, let’s see the following steps.

**📌**** Steps:**

- First of all, make a table for Needs expenses.
- Then, in
**Column B**, write the numerous areas of expenses. Like, here we’ve used**Housing Rent**,**Food,**etc. which are basic needs.

- Secondly, select cell
**C18**and paste the formula below.

`=SUM(C12:C17)`

Here, we used the **SUM function****,** to sum up the total expenses for our needs.

- After that, hit
**ENTER**.

- At this time, we wish to figure out the
**% of Needs**for each sector. Like, what percentage of the total needs, we spent on**Food**? - To do this, go to cell
**D12**and paste the following formula.

`=C12/$C$18`

- Then, press
**ENTER**.

*Note:** Don’t forget to change the format of cells in D12:D17 to *

**.**

*Percentage*- Now, bring the cursor to the bottom-right corner of cell
**D12**. Instantly, it’ll look like a plus**(+)**sign. Actually, it’s the**Fill Handle**tool. Then. double-click on it to copy the formula in the rest of the cells.

- Consequently, we got results in the following cells also.

**Equivalently**, do the same for**Wants**and**Savings**.

**Read More:** **How to Create a Personal Budget in Excel (With Easy Steps)**

**Similar Readings**

**How to Make a Budget Constraint Graph on Excel****Prepare a Vacation Budget in Excel (with Easy Steps)****How to Make Food and Beverage Budget in Excel****Make a College Budget in Excel****How to Create a Construction Budget in Excel (with Easy Steps)**

### Step 04: Compare Actual Expenses with the Ideal Budget

In this part, we’ll analyze the difference between our **Ideal Budget** and **Actual Expenses**. So, without further delay, let’s dive in!

- Initially, select cell
**G5**and put in the following formula.

`=C18`

Here, **C18** serves as the cell reference for **Total Needs**. Actually, we’re fetching this value from cell **C18** to cell **G5**.

- As usual, press
**ENTER**.

**Similarly**, fetch the values of the**Total**of**Wants**and**Savings**from cells**C28**and**C35**to cells**G6**and**G7**respectively.

In the beginning, we calculated an ideal amount of **Needs**, **Wants**, and **Savings**. But, after bearing all expenses for the month, obviously, the percentage of these 3 components should be different. Here, we’ll testify about this matter.

- So, move to cell
**H5**and put down the following formula.

`=G5/$C$9`

Basically, we’re calculating the **Actual Percentage** of **Needs** to the **Total Budget**.

- As always, hit
**ENTER**.

From the picture above, we can clearly notice that the **Actual Percentage** of **Needs** is **41.93%**. But, in the beginning, we took it as **50%**. So, here, the person spent less than the ideal amount. The same happened for other components also. They differ from the ideal amount also.

**Read More:** **How to Create Actual Vs Budget Variance Reports in Excel**

### Step 05: Determine Surplus or Shortage

At the beginning of the month, an individual can **make his budget**. At the end of the month, after completing all the tasks, he may have some extra money or some shortfall. Here, we’ll determine this. So let’s explore this step by step.

**📌**** Steps:**

- Primarily, select cell
**G9**and enter the following formula.

`=SUM(G5:G7)`

Fundamentally, we have added all the costs here.

- Then, tap
**ENTER**.

- After that, go to the following cell
**G10,**and paste the formula below.

`=C9-G9`

In this formula, we are subtracting the **Total Expense** from the **Total Income**.

- Correspondingly, hit
**ENTER**.

- Following this, go to cell
**F10**and enter the following formula.

`=IF(G10>0,"Surplus","Deficit")`

Here, the **IF function** inserts a logical test. If the value in cell **G10** becomes greater than **0**, then it will show a text sting **Surplus** in cell **F10**. Otherwise, we’ll see a text **Deficit** in cell **F10**.

- As usual, press
**ENTER**.

Additionally, you can apply **Conditional Formatting** in cell **F10**. From the above picture, you can see a **Green** fill color in cell **F10**. When it exhibits **Surplus**, it will be **Green**. And, it will look **Red** while displaying the text **Deficit** inside the cell.

**Read More:** **How to Calculate Remaining Budget Using Formula in Excel**

### Step 06: Insert Chart to Visualize Easily

We can insert a graph to visualize the 50-30-20 budget. A common technique for showing data linkages graphically is to insert a chart. Charts are used to communicate large or complex amounts of data. And those take up less space while being completely expressed in the text. So, let’s see the process in detail.

**📌**** Steps:**

- Firstly, jump to the
**Insert**tab. - Secondly, click on the
**Insert Pie or Doughnut Chart**drop-down icon. - Thirdly, select the
**Doughnut**chart from the available options.

Immediately, it adds a blank chart on the sheet.

- Now, right-click anywhere on the chart area.

Instantly, the context menu pops up.

- Then, choose
**Select Data**from the menu.

Suddenly, the **Select Data Source** dialog box appears before us.

- Here, select the
**Add**button under the**Legend Entries (Series)**section.

Immediately, it brings up the **Edit Series** input box.

- In the
**Series name**box, give the reference of cell**H4**which is the**Actual Percentage**. - And, in the
**Series values**box, give the reference of the**H5:H7**range. - Lastly, click
**OK**.

- Now, click on the
**Edit**button under the**Horizontal (Category) Axis Labels**section.

Instantly, it opens the **Axis Labels** input box.

- In this place, give the reference of the
**E5:E7**range in the**Axis label range**box. - Ultimately, click
**OK**.

- Finally, click
**OK**on the**Select Data Source**dialog box.

Simply, it inserts a chart of the **Actual Percentage** on the spreadsheet.

- Straightaway, add
**Data Labels**to the chart using the**Add Chart Elements**options.

Similarly, you can introduce charts for various analyses. Here, we’ve added charts for visualizing the percentage of different components of **Needs**, **Wants**, and **Savings**.

**Read More:** **How to Make a Budget Pie Chart in Excel (with Easy Steps)**

## Free Template: Ready to Use

In this workbook, we have added an extra sheet concluding a free 50-30-20 monthly budget template. You can use this in your daily life. Also, you may change and edit it according to your needs. You just have to fill up the **blue-colored** cells. Other calculations will be done automatically.

## Conclusion

This article provides easy and brief solutions to create a 50-30-20 budget spreadsheet in Excel. Don’t forget to download the **Template** file. Thank you for reading this article. Hopefully, this would be beneficial for you. Please let us know in the comment section if you have any queries or suggestions. Please visit our website, **Exceldemy** to explore more.

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