Separate fixed and variable expenses
Fixed expenses repeat on a schedule: housing, phone, insurance, subscriptions, and loans. Food and transport often vary and are clearer in a separate budget.
Convert annual or quarterly bills to monthly equivalents before comparison.
- Monthly: enter as paid
- Quarterly: divide by 3
- Annual: divide by 12
Match income to take-home cash
Use monthly take-home income for practical cash-flow planning. Exclude irregular side income conservatively or test it as a separate average scenario.
For a household budget, align whose income and shared expenses are included.
Example: 1.5 million won fixed from 3 million
With 3 million won take-home and 1.5 million in fixed costs, the ratio is 50% and the annual fixed total is 18 million won.
The remaining 1.5 million still needs to cover variable spending, irregular costs, and savings.
- Fixed ratio = monthly fixed costs ÷ monthly income × 100
- Annual fixed cost = monthly fixed cost × 12
- Available amount = income - fixed cost
Find forgotten recurring charges
Review three months of transfers and card statements for unused apps, cloud storage, memberships, and installments.
There is no universal ideal ratio. This is a budgeting check, not personal financial advice.