Dave Ramsey Budget Percentages — in the real world

How much should you spend in each budget category? This article lists the Dave Ramsey budget percentages, categories, with a sample budget so you can jumpstart your budget.

Since our debt free story went viral,  I’ve been getting a lot of questions about exactly how we did it. Today, I’ll be answering one of the most common questions by sharing my real life debt free budget percentage breakdown. 

Specifically, I’ll be sharing my thoughts about one of the most common questions I get asked: “How much should I be spending in each budget category?”

And to satisfy my own nerdy love of data, I’ll be comparing my own budget while we were working to be debt free to the budget percentage breakdown that Dave Ramsey recommends, and just for fun, the spending habits of the average American.

It's common to wonder how big of a slice of pie to give each budget category. The Dave Ramsey budget percentages offer one option. But how well do they work in the real world? We'll take a look.
It’s common to wonder how big of a slice to give each budget category. Dave Ramsey’s budget percentage guidelines offer one option. But how well do they work in the real world?

Dave Ramsey Budget Percentage Breakdown

Budget CategoriesOur Debt Free BudgetDave Ramsey Budget Percentages (1)Average American Spending (2)
Saving0%10-15%n/a see Savings, Debt, Other below
Utilities6-10%5-10%n/a included in housing
Food (Groceries & Restaurants3-20%5-15%17%
Transportation2-4% (car payment included in debts)10-15% (car payment included in debts)14% (includes vehicle purchases)
Medical/Health4-27%5-10%6% (includes health insurance)
Insurance1-4%10-25% (includes health insurance)9% (health insurance included in Medical/Health category)
Personal4-25%5-10%5% (All other expenses)
Recreation/ Entertainment0.1%-0.5%5-10%4%
Debts23-77% (includes car lease payment)5-10% (Goal is 0%)n/a, see savings, debt, other
Savings, Debt, Other not includedn/a, see aboven/a see above14%

Where Our Budget Percentages Differed from Dave Ramsey’s Recommendation

Now let’s take a look at how the dave ramsey percentages work in the real world when you’re trying to pay off debt.

You’ll see a range of budget percentages for my real life debt free budget. These varied from month to month for a few reasons.

One big reason that our percentages cover a wide range is that our income varied wildly each month as I hustled to earn as much extra from home as possible. 

Sometimes, we had just our usual paycheck.

Others, I might have gotten paid for a big project or blog promotion.

Dave Ramsey Food Budget

As time went on, I learned to save more, especially in the grocery category.

The recommended Dave Ramsey food budget percentage is 5-15%. As you can see, I was able to get my food budget down to just 3% some months. This was a crucial area of savings to allow us to pay off our debt even faster.

Personal Category

Dave recommends spending 5-10% in the Personal Category. Ours ranged from 4-25%.

This was due to childcare expenses while I worked part-time the last couple of months to finish up our debt payoff.

Dave Ramsey Health Care Category

While Ramsey’s recommended health care percentage is between 5-10%, ours ranged from 4-27%.

This is because expenses outside the usual did come up once in a while. Specifically, in the first month, we paid the midwife for the birth of our second child, so you’ll see a big variation in the health category.

Dave Ramsey Savings Percentage

While the Dave Ramsey savings percentage is 10-15%, his baby steps say you should pay off debt first before building your 6-month emergency fund.

We followed this recommendation and focused completely on paying off debt at this time, choosing to wait on saving and giving until later, so our savings percentage is 0%.

Dave Ramsey Clothing Budget

The recommended Dave Ramsey clothing budget percentage is 2-7%. However, you can probably see from my debt free budget breakdown that we spent only 1% on clothing.

In fact, we spent almost nothing on clothing, entertainment, and household items. Because these are more wants than needs, we decided to spend as little as possible to help us pay off our debt faster.

Dave Ramsey Housing Percentage

While Dave’s housing percentage is 25-35%, we were blessed to have very affordable rent at the time. We spent just 15-20% during our debt payoff.

(Again, this varies because our income fluctuated, not because we moved.)

To cut costs on transportation, my husband drove to the park-and-ride and took the bus to work.

These are just the ways we were able to ‘balance’ our budget and get out of debt fast. Your situation is probably completely different, so I’ve listed a few key tips below that can get you started on making your own debt free budget.


(1) Dave Ramsey Monthly Cashflow Plan

(2) Bureau of Labor Statistics, Consumer Expenditures 2013

How to Make Your Own Debt Free Budget

If you’re working on creating your own budget, feel free to use the budget worksheet I created for my own budget as a starting point.

Click here to grab your free Family Budget Worksheet printable

I do my categories a little bit different than Dave, so that it works better with the free budgeting app Mint. I’ll list the Dave Ramsey categories below if you’d rather use his.

Dave Ramsey Budget Categories

  • Charity 10-15%
    • Tithes
    • Charity & Offerings
  • Savings 10-15%
    • Emergency Fund
    • Retirement Fund
    • College Fund
  • Housing 25-35%
    • First Mortage/Rent
    • Second Mortgage
    • Real Estate Taxes
    • Repairs/Maint.
    • Association Dues
  • Utilities 5-10%
    • Electricity
    • Gas
    • Water
    • Trash
    • Phone/Mobile
    • Internet
    • Cable
  • Food 5-15%
    • Groceries
    • Restaurants
  • Clothing 2-7%
    • Adults
    • Children
    • Cleaning/Laundry
  • Transportation 10-15%
    • Gas & Oil
    • Repairs & Tires
    • License & Taxes
    • Car Replacement
    • Other
  • Medical & Health 5-10%
    • Medications
    • Doctor Bills
    • Dentist
    • Optometrist
    • Vitamins
    • Other
  • Insurance 10-25%
    • Life Insurance
    • Health Insurance
    • Homeowner/Renter
    • Auto Insurance
    • Disability Insurance
    • Identity Theft
    • Long-Term Care
  • Personal 5-10%
    • Child Care/Sitter
    • Toiletries
    • Cosmetics/Hair Care
    • Education/Tuition
    • Books/Supplies
    • Child Support
    • Alimony
    • Subscriptions
    • Organization Dues
    • Gifts (including Christmas)
    • Replace Furniture
    • Pocket Money (Hers)
    • Pocket Money (His)
    • Baby Supplies
    • Pet Supplies
    • Music/Technology
    • Miscellaneous
    • Other
  • Recreation 5-10%
    • Entertainment
    • Vacation
  • Debts 5-10%
    • Car Payments
    • Credit Cards
    • Student Loans
    • Other

If you’re looking at the budget category guidelines above and then looking at your own spending and wondering how you’re supposed to get from there to here, here are a couple of suggestions.

If you find that you are spending significantly more in a particular category, it might be time to make make a big change to start living within your means and get out of debt. After years of struggling against what we thought our lifestyle should be, my husband and I had to get honest about what we could truly afford.

Another approach is to look for smaller changes to make to cut your overall budget and start paying more toward your loans. We implemented almost every one of these 97 Easy Ways to Save Money to pay off debt faster.

As you create your own budget, be sure to include these commonly forgotten budget categories. There’s nothing more frustrating than working so hard to stick to a budget only to find that you’ve forgotten a major expense.

Above all, though, as you make your budget, don’t lose sight of your bigger goals. Do you want to get out of debt and start moving toward some big dreams for your family? Do you want more financial peace and freedom in your household?

Once you know where you’re going, and why, then you can work backward from that and set your spending and budget based on what you need to do to make that big goal happen. Even if you have a long way to go before achieving your goal, just starting to live into your true values and priorities can be so rewarding!

Which of the 3 budget guidelines does your budget most closely resemble? What are the budget categories where it’s the hardest to save?

Where can I send your free Family Budget Worksheet printable?

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shannon Clark, LIFE & FINANCIAL Coach

As a mom, I know what it's like to feel exhausted, overwhelmed by life, and inadequate to meet my children's needs. But I also know you don't have to stay there.

As an author and coach, I've had the joy of encouraging more than 9.1 million moms to find forward motion with their faith, family, and finances — without the frenzy.

Will you be next?

16 thoughts on “Dave Ramsey Budget Percentages — in the real world”

  1. I love your comparisons with the national average. It would be so interesting to do this for our family. Thank you!

    • Fantastic piece , I learned a lot from the information – Does anyone know where my assistant might acquire a fillable Canada AR-1 version to work with ?

  2. I love this breakdown and comparison! The basic categories above are great, but I’m wondering where some things fit in — some from your own “commonly forgotten” budgeting list. For instance: where do fees such as tax prep and bank fees go? What about professional fees/memberships which are not covered by work? Pets: do they go under “Personal”? And, finally, school supplies/fees. Just wondering what sort of percentages to aim for in these areas. Any thoughts?

    • Thanks, Jennifer, that’s a great question! I would look at the categories listed above more as broad categories that would all have sub-categories beneath them. You can check out my budget printable for more detail. I think there are about three dozen sub-categories altogether. Yes, most of these would fall under Personal, which I think I called Lifestyle on my budgeting worksheet. Since everyone’s situation is so different, it’s hard to say exactly except for as little as possible if you’re trying to pay off debt. :) I would say that when we were paying off our debt, most of the expenses you listed were very low. We used online tax prep for about $40 for the year, no bank fees, about $7/month for professional fees, about $9/month for pets, and our kids weren’t yet old enough for school. I think the best thing is just to get started with a budget and adjust as necessary as you go. I really believe everyone should create a new budget every month, even if it’s mostly the same because every month is different. A lot of people run into the trouble that there’s never a “normal” month, so they’re never able to stay in budget.

  3. Ours is between yours and Dave Ramseys’. Overall, about 25% goes to our debt. The hardest area to save for us is food/groceries.

  4. Ok, I have a budget, and I have an extremely tight budget. I have NO Debt, since 12/2003. However, I am a single guy, making about $40K. But I need to know how to make some extra money. I have seem a Bazillion ads to “Make money” on the internet. Which ones are legitimate? I am going to go back to school, to get another degree, one which will definitely give me more money, but I don’t want to go into debt to to this. Any suggestions?

  5. I disagree with the percentages model, since (in a given month), your income is what it is, and your expenses are what they are. For example, your car note and mortgage/rent payment are fixed expenses.

    With a spreadsheet and knowledge of what you buy at the grocery store, your insurance coverage, cable/satellite bill, size of car, family size, etc, you allocate money that month and work out where you can reduce spending (sell or trade in a car, increase deductibles, trim TV services, drink less alcohol, etc).

  6. I find the budget percentage recommendations to not make full sense. If you total up the minimums of all the recommended budgets for each category you are already at 97%. Whats the point of having maxes if those will likely carry you over 100% of your budget.

    • Yes, exactly! That is one of the big issues with doing a percentage budget. I have a new post coming out soon that expands on this and offers some alternative budget percentage recommendations.


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