New Graduate Budget Calculator

This calculator turns a first-job annual salary into a workable monthly budget by first converting gross pay to net: it divides your annual salary by 12 for monthly gross, then applies your effective tax rate (combining federal, state, and FICA) to estimate monthly take-home. From there it applies the classic 50/30/20 split — 50% needs, 30% wants, 20% savings — against net income, and separately shows what's left after your two biggest fixed costs, rent and student loan payment, are subtracted directly. The debt-free timeline is the most mathematically involved piece: it uses the standard loan amortization formula (solving for the number of payments given balance, monthly payment, and interest rate) assuming a flat 5.5% rate on your remaining balance, which won't match your actual rate if you have a mix of federal and private loans or loans issued in different years. That calculation only produces a result if your payment exceeds the interest accruing each month — if your payment is too low to ever cover interest, the loan would never pay off under current terms, and the calculator returns zero months rather than a negative or infinite answer.

The rent-to-income ratio compares your rent directly to net monthly income, with the common guideline being to keep it under 30%. Because this treats student loan payment as a fixed, unchanging line item, it won't reflect what happens if you later switch to an income-driven repayment plan or refinance at a different rate — those changes would need to be re-run through the calculator with updated inputs. It's best used as a first-pass framework for a new grad's first budget, not a substitute for checking your loan servicer's actual amortization schedule.