How it works
Disposable income is what's left after mandatory deductions (taxes, insurance) and fixed costs (rent, utilities) — the money you actually control. Budgeting off this number, not gross income, is far more realistic. A lower fixed-cost ratio means more financial flexibility, so aim to bring it down over time.
FAQ
Q. What counts as a fixed cost?
A. Include rent, utilities, phone bills, insurance, subscriptions, and loan payments — anything roughly fixed each month.
Q. What % of disposable income should I save?
A. A common guideline is putting at least 20–30% of disposable income toward savings and investing.