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Monthly Expenses to Include in Your Budget

Would you give a big presentation at work without preparing at all? What about your wedding day? You wouldn’t just show up without a plan and hope it all worked out, right? Not in a million years.

The truth is, you’re way more confident—and you enjoy life more—when you’re prepared for it.

The same thing is true for your money. That's why you need a plan, aka a budget.

And that starts with taking a look at your basic monthly expenses.

Of course, monthly expenses vary from person to person and situation to situation, but there are some common monthly expenses to think about when you start a basic budget. Here’s a list to get you started!

Basic Monthly Expenses

1. Giving

It may seem backward to think about giving as a common monthly expense because there’s already so much in life to pay for. But hear us out.

Around here, we’re all about being generous. Yes, even if you’re in debt. And yes, it’s the first thing we budget for each month. Not just because we like to be a little weird (we do!), but because when we give, it takes the focus off of what we’re lacking and shines a light on helping others.

Whether you give to your church or your favorite charity or organization, start your month by giving 10% of your income to a specific cause dear to you. 

2. Saving

Depending on what Baby Step you’re on, you might need to make saving a priority. Not only does a padded savings account give you peace of mind, but it also helps you plan for big purchases.

If you’re in debt, start by saving a $1,000 starter emergency fund (we call this Baby Step 1)—then pause saving and throw everything else (after your necessary monthly expenses) at crushing that debt.

Once you’re out of debt, you’ll save up 3–6 months of expenses in case of a bigger emergency, like an unexpected sickness or job loss.

3. Groceries

Before you budget for any of the other monthly expenses, cover what we call the Four Walls—aka the basic necessities you need to survive: food, utilities, shelter and transportation.

We put groceries as its own line, apart from restaurants, because you have to eat—but you don’t have to eat out.

And if you’re looking to find extra money in your budget, food is the place to start. It’s the number one category where people overspend (so easy to do, right?). Use coupons, eat what you have at home, start meal planning—it all adds up in a month.

4. Utilities

Include all the services that keep your house running: electricity, water, natural gas or propane, and trash services. Remember, these utility bills might change from month to month. Blazing hot summer? Add a little extra to this category. (Nobody likes to sweat while they sleep!). Frigid winter temps? Put on some fuzzy socks. Then? You get the drill. Add a few bucks.

To be safe, budget on the higher side in each of these budget lines—and if you don’t end up needing it, throw the extra at your debt (if you have any!) or your savings.

5. Housing

Just including your rent or mortgage payment isn’t enough when budgeting for your housing costs. Don’t forget insurance, property taxes and HOA fees. Whew, right? It adds up quick! To keep your housing costs from hogging most of your budget, keep these expenses to 25% or less of your take-home pay.

6. Transportation

This category includes gas, public transit fees, routine maintenance—anything you typically pay in a month for transportation.


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Keep in mind these numbers might be different depending on your schedule or the time of year. Stay on top of your calendar and add extra for special occasions like traveling to Grandma’s or an out-of-town soccer tournament.

Okay, we’re past giving, saving and the Four Walls. The rest of these monthly expenses aren’t in a perfect order, but they’re a bunch of common things people spend money on every month. While you may not have some of these bills, this list should help you get the wheels turning as you create your own budget.

7. Insurance

Yeah, insurance can be kind of boring, and it might feel irritating to spend money on it, but paying for insurance is a must. Think of it like a shield—insurance helps protect all the things you love and will be your saving grace when life happens. (Because it will).

When budgeting your monthly expenses, don’t forget to include monthly premiums for these insurances you can’t do without:

  • Term Life Insurance
  • Auto Insurance
  • Homeowners/Renters Insurance
  • Health Insurance
  • Long-Term Disability Insurance
  • Long-Term Care Insurance (if you’re age 60 or older)
  • Identity Theft Insurance
  • Umbrella Policy (if you’ve got a net worth of $500,000 or more)

8. Household Items

Toothpaste, shampoo, dishwasher detergent, paper towels. They’re not necessarily the most exciting monthly expenses to put in a budget, but household items are a part of life. And guess what? You use them every day, so these aren’t monthly expenses that should surprise you.

Keep a list of items you’re running low on so you can plan ahead and always have money to cover what you need.

9. Childcare

Listen—if you’ve got kids, you know you’ll need a babysitter every once in a while, right? Whether it’s for a planned date night, something unexpected or just for your sanity, adding a babysitting budget category will be your lifesaver. (Or better yet, save on this budget line by getting a family member to watch the kids or by swapping babysitting nights with another couple for free!)

If you have a child in day care, you’ll likely have to pay to reapply each year and hold their enrollment spot. If your kids are already in school, be aware of season-specific camps and workshops, plus the fees, uniforms and snacks that go with each. And don’t forget about field trips and school pictures!

10. Pet Care

We can’t forget the fur babies! Annual exams and shots are easier to budget for since you know they’re coming, but what about those vet trips that happen out of the blue? You might want to create a line item in your budget for your pup or feline friend. This can save you when you have to take an unexpected trip to the vet—or even when you just run out of cat litter.

11. Health and Fitness

Health and fitness aren’t just trendy fads—they’re monthly expenses you definitely need to take seriously. Because you’re worth it. Think of all the things you need each month to keep you healthy and sane (no, wine doesn’t count here) and include them.

Medicine, vitamins, supplements, gym memberships, workout apps, therapy—it all counts here. But think carefully about what’s actually a need and what can fall under a want (hey, that’s why you budget some fun money each month!). This is another category that’s a good place to cut back on if you’re looking to save some money—because you can get fit and healthy on a budget.

12. Debt

Credit cards, student loans, car payments—oh my! It’s amazing (but not in a good way) how fast these debt payments add up each month. And it’s amazing how much debt actually steals from your budget. That’s why we want you to get rid of it—fast. When you budget, you get to tell your money where it goes. Not the other way around.

So, are you tired of feeling like you can’t ever get ahead? We’ve got you. Start by listing all of your debts and then use the debt snowball method to get rid of them one by one. And then, you won’t even need this budget category, and all that money can go to the good stuff.

13. Phone Bill

This one’s easy. Whether you only use your cell phone or you’re still hanging on to your house phone for dear life, don’t forget to include your phone service in your monthly expenses.

14. Personal Money

Or better known as fun money. Yes, seriously. We budget for fun. Because what is life without a little fun? Kidding aside—this category is just for you. Put aside some money each month for a few things you can buy guilt-free.

If you’re in debt, don’t worry—you don’t have to get rid of all the fun. But we do want you to get out of debt as fast as you can, so cut way back on this category until the debt is gone. Treat yourself with small rewards along the way (like your favorite Starbucks drink or a fun new magazine) so you can keep yourself motivated.

15. Entertainment and Recreation

Tickets to a concert. A ballgame with your kids. Bowling with friends. It’s great to spend money on things you enjoy—if it’s in the budget! (Because you can have fun without spending money too!)

When you’re budgeting for fun things, don’t let FOMO take over and get you to say yes to all the things. Listen, your budget—and your money goals—don’t have room for that. Plan how much you can spend each month on hobbies and entertainment. And then stick to it.

16. Restaurants

If you love eating out, budget for it! That includes nice evenings dining out and any time you hit up the drive-thru. Just remember that restaurants aren’t an essential. If you need to free up cash for one of the Baby Steps, this is a great place to cut spending and save money!

17. Investments

When you’re on Baby Step 4, you’ll be ready to plan for your future by investing 15% of your income into retirement. Make sure your budget is ready for it.

18. Miscellaneous

Can we say it all together? Thank goodness for you, miscellaneous category. The random pack of gum (nobody likes bad breath). The last-minute goody bags for a school party. The haircut appointment you forgot about. All these forgotten extras can go into this budget category. But be careful—they add up quickly.

Easily Forgotten Monthly Expenses

When does the Amazon Prime membership renew? What about the car tag renewal? And when is that annual checkup?

Even though these expenses only pop up every once in a while, you don’t want them to surprise you and derail your monthly budget.

So, take some time to update your calendar with renewal or appointment dates.

When you’ve got everything plugged into your calendar (paper or digital—we don’t judge!), it’s much easier to build a more accurate budget each month. Just don’t forget to look at your calendar when you sit down to make your monthly budget!

Here are a few forgotten or overlooked expenses to think about:

1. Pest Control

Having your house chewed up by tiny bugs or covered with spiders usually decreases its value. Whether it’s once a quarter or once a year, call in the professionals or do a DIY job to get your home protected from termites and pests.

2. Organization Dues

If you’re involved in a professional or civic organization or live in a neighborhood with a homeowners association, don’t get blindsided by the fees, especially if they’re due just once a year. Mark your calendar and plan ahead!

3. Annual Checkups and Copays

No amount of laughing gas will ease the pain of an unbudgeted dental cleaning. This one can hit hard since it affects the whole family. You can schedule everyone’s dentist or eye doctor’s appointments in a single week or month to make it easier to remember and budget for, or you can spread them out if your budget prefers that method. And for those annual checkups or specialist appointments, don’t forget to budget for the copays!

4. Home Maintenance

Home expenses don’t stop at utilities and mortgages. Don’t forget the stuff like gutter cleaning and HVAC inspections. But if you own a home, saving money for maintenance is a must. Some expenses you can plan for—and some maybe not (that’s where your emergency fund comes in!). Be budget-ready for both!

5. Special Occasions and Gifts

Surprise parties are fun, but not when it’s “Surprise! Another niece needs a birthday gift card.” Be sure to include approaching holidays, birthdays, weddings, baby showers and all other special occasions in your budget. It might also be a good idea to squeeze in a monthly gift line. That way, you’ll know exactly how much you can spend.

6. Taxes

It’s everybody’s favorite thing—taxes! (We kid, we kid.) If you’re a business owner or freelancer, or if you’re working a side hustle, don’t let taxes sneak up on you. It might be a good idea to set aside a little bit of money each month for your taxes.

And don’t forget to budget to pay for your tax pro’s services or for your tax filing software when it comes time to file.

7. Annual Subscriptions and Memberships

Sure, you’re used to your Netflix subscription coming out monthly. But you forgot about Amazon Prime coming out right after Christmas. Ouch. Do not—we repeat—do not go into freak-out mode. You can make a plan for this.

To account for those big-ticket subscriptions and memberships that come out annually (or even quarterly or semiannually), put a reminder in your phone at the beginning of the month it will hit so you can keep track. Or use a sinking fund to save a little each month to put toward the fee. (We’ll talk more about this in just a sec.)

How to Budget Your Monthly Expenses

So, you’ve got a handle on what your monthly expenses could be—now you need to know how to practically budget for them each month.

Step one? Get a big-picture idea of what’s coming in. Write down all of your income in a typical month. (You can still tackle this, even if you have an irregular income!)

Next, make a list of all your monthly expenses (yes, even the easily forgotten ones).

Then, subtract your expenses from your income—and that number should equal zero. This method is called zero-based budgeting.

Now, a zero-based budget doesn’t mean you have zero dollars in your bank account. (Keep a little buffer of $100–$300 in there.) It also doesn’t mean you spend everything you make.

Nope. It simply means every dollar that comes in gets a job. It means you plan how you give, save, spend and invest all of your income, so at the end of the month, you don’t wonder where all your money went. When you budget, you are in control of where every single dollar goes. And that means you can feel confident that you’re spending and saving well.  

How to Build Forgotten Monthly Expenses Into Your Budget

When you’re creating your budget, remember to give yourself some grace. You’ll forget to include some of your monthly expenses at first—especially if you’re new to budgeting!  That’s okay. Just tweak your budget to make room for whatever expense you left out. That means you’re going to have to cut back spending somewhere else—like eating out or fun money.

But for those once-in-a-while or easily forgotten monthly expenses, here are a few ways you can plan ahead:

Start a Sinking Fund

With a sinking fund, you save a small amount each month for a certain amount of time before you make your purchase. You determine how much you save by taking the total amount you need and dividing it by the number of months you have left until the bill is due.

For example, if you want to spend $1,000 on Christmas and it’s August, that leaves you about five months to save for an all-cash Christmas. Put a line item in your budget and stash away $200 per month until December.

To set up your sinking fund, you can either open up a separate savings account or just use the sinking fund feature in your EveryDollar app. This is a great way to save up to cash flow Christmas, a vacation, or even a large expense like a wedding!

Remember Your Emergency Fund

There are some unexpected monthly expenses that really will be an emergency. It can be anything like your car’s transmission going belly up, the air conditioner breaking in the middle of summer, or your pet needing an emergency surgery.

This is why the first Baby Step is saving up $1,000 as fast as you can. You need this buffer between you and life. After you’ve paid off your debt (everything except the mortgage), you’ll start saving up for a fully funded emergency fund of 3–6 months of expenses.

Create a Budget Line Item

If a certain monthly expense keeps popping up, it’s not really forgotten anymore, right? That means the expense could be ready for its own budget line. Just make sure to evaluate whether it’s a want or if it’s truly a common expense that should be included in your regular monthly budget.

Before you dive into polishing up your budget, step back and take a breath. It took a lot of work to get this far, so don’t let a few details stand in your way! Tackle your monthly expenses by looking at the big picture before you budget. Then, plan each month the smart way.

But you can’t make a plan if you don’t have a budget. Step one? Make. A. Budget. Get started budgeting for all the monthly expenses coming your way with our favorite budgeting app, EveryDollar.

And remember, you’re the one who calls the shots with your money—one monthly budget at a time!

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Ramsey Solutions

About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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