Do Dave Ramsey Budget Percentages Work? (2021 Update)

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Have you ever struggled to make a budget? You’re not alone! Budgeting is a crucial component of financial wellness, but it is sometimes hard to know if you’re on the right track.

That’s where Dave Ramsey’s budget percentages come in. These percentages offer guidelines to help you determine what makes sense for household spending, saving, and giving.

Dave Ramsey Budget Percentages Quick Take

  • Dave Ramsey’s percentages are a great starting point for your budget, offering a quick way to identify overspending
  • Dave Ramsey’s percentages help you consider different aspects of your financial life
  • Dave Ramsey’s percentages allow you to prioritize giving and saving as well
  • Dave Ramsey’s percentages can help you finally get ahead with your finances
  • While helpful, the budget percentages should be adjusted as needed for your life circumstances, as no budget is one-size-fits-all

Dave Ramsey’s Recommended Budget Percentages

Here’s what a Dave Ramsey budget form might look like based on his categories and percentages.

Category Dave Ramsey Budget Percentages
Giving 10%
Saving 10%
Food 10 – 15%
Utilities 5 – 10%
Housing 25%
Transportation 10%
Health 5 – 10%
Insurance 10 – 25%
Recreation 5 – 10%
Personal Spending 5 – 10%
Miscellaneous 5 – 10%

Dave Ramsey Budget Category Details

One of the reasons that some budgets fail is because they don’t accurately capture all of the expenses that budgeters are likely to encounter. That’s why Dave Ramsey percentages are so helpful: They ensure that you are looking at your complete financial picture to identify areas that you’ve mastered and places where you need to shift your focus.

Let’s take a look at exactly what each of Dave Ramsey’s budget categories covers.

Giving (10%)

While all parts of personal finance are personal, giving is especially so. As a result, it doesn’t often get talked about. Whether you tithe or perform other acts of charitable giving, this category helps budgeters set aside money each month to better their community and world.

Saving (10%)

Don’t let the name fool you! This category isn’t solely limited to savings accounts. You can also include investments, such as Roth IRAs or 401k contributions here. No matter where your money lands, this budget category helps you prioritize your financial future.

Food (10% – 15%)

Are you eating your budget? A lot of people do! There’s a reason that food is part of the Big 3 Expenses people encounter.

This food category includes both grocery spending and eating out. Many people who use Dave Ramsey percentages for the first time quickly realize that this is a category that needs their attention.

Utilities (10%)

Think of utilities as the basic services needed to keep your home running. Natural gas, water, and electricity are some of the basic utilities that you want to budget for. This is particularly important if you live in a place where shifts in season can dramatically impact utility costs.

Housing (25%)

Housing includes your rent and your mortgage. It also includes more than that! Whether you have renters insurance or homeowners, include that in this category. You also want to include your property taxes here.

Transportation (10%)

How do you move around throughout the month? Many families have at least one car, so make sure to include car payments if you have them, plus gas, parking passes, registration costs, and insurance. If you bike to work or take an occasional Uber, make sure you account for all those costs too.

Health (5% -10%)

If you have chronic conditions that require routine office visits and prescription medication, you have a great starting point for this category.

Even if you and your family are the picture of health currently, this category can help you set aside money for the future. It might be a medical emergency that requires a trip to the ER, or it might be a bad cold that requires you to restock the medicine cabinet. Either way, this category can help you avoid debt.

Insurance (10% – 25%)

This category should include health insurance. You also want to factor in disability insurance and life insurance, if they apply to your situation.

Recreation (5% -10%)

This is a fun category to budget for! Recreation includes the different things that you and your family do for fun. Maybe it’s your Hulu subscription or a kid’s class at the park district.

Remember that budgets aren’t about restrictions. They should allow for fun, and this is one place you can see that.

Personal Spending (5% -10%)

Personal spending accounts for things like new shoes and haircuts. It might also cover home decor and toys.

No matter how you define personal spending, it is important to set money aside to account for it.

Miscellaneous (5% -10%)

Everyone needs a slush fund, and that’s what this miscellaneous category is. It covers little one-time purchases or things that you forgot to budget for. Since no budget is perfect, think of this category as a bit of wiggle room for your money.

Example Dave Ramsey Budget

Putting this into practice, here’s a sample budget using Dave Ramsey’s percentages:

Category Budget Percentages Budget Totals
Giving 10% $500
Saving 10% $500
Food 10 – 15% $500
Utilities 5 – 10% $250
Housing 25% $1,250
Transportation 10% $500
Health 5 – 10% $250
Insurance 10 – 25% $500
Recreation 5 – 10% $250
Personal Spending 5 – 10% $250
Miscellaneous 5 – 10% $250

Obviously, this sample budget is not reflective of every individual or family who will use Dave Ramsey’s budget percentages. Some of you might be thinking that the Dave Ramsey budget calculator is a bit off. It might be for your situation!

Your income can certainly influence how accurate this budget feels. Additionally, many people point out that depending on their area’s cost of living, some of the percentages may need to be adjusted.

Another important consideration about these budgeting percentages is that this budget does not account for people who are paying down debt. If that’s true for you, you may want to reduce the percentages of some of the discretionary spending categories in order to put more income toward your debt.

Do Dave Ramsey’s Budget Percentages Work?

Dave himself would likely be the first to tell you that all budgets are unique and these percentages are only a guideline. Still, Dave Ramsey’s budget percentages do work!

The purpose behind the Dave Ramsey budget percentages is to help budgeters quickly spot areas of overspending. They also help you focus on more than just household expenses. By using these percentages, you can ensure that you are also prioritizing savings and investments, as well as charitable giving and tithing.

Best Budgeting App For Dave Ramsey Percentages

Ready to apply the Dave Ramsey Percentages to your budget? These apps can do a lot of the heavy lifting for you.


EveryDollar will feel most familiar with Dave Ramsey fans. Why? It’s actually a Dave Ramsey budget app! The app will allow you to create a budget in approximately ten minutes. Because this is a zero-based budgeting app, you assign every dollar a job. That means you can easily apply the Dave Ramsey percentages to your budget.

You can also upgrade to the premium version for a fee. Not only is EveryDollar Plus more streamlined and automated. The upgrade also comes with access to their Baby Steps app and online Financial Peace University teachings.

Check out our full EveryDollar Review for more details.


While YNAB isn’t an official Dave Ramsey budget app, you can still use YNAB to make the Dave Ramsey budget percentages work for you.

YNAB is a paid app that gives you total control of your budget and automatically tracks your money movements (spending, saving, and so on). Because you have ultimate control, you can also recategorize transactions as needed.

Another impressive aspect of YNAB is the value they place on financial education. If you are struggling to understand the why behind the Dave Ramsey percentages or want to learn more about personal finance in general, the app offers robust support.

Try YNAB for free, or check out our full YNAB review for more details.


Tiller Money is perfect for anyone looking to test out the Dave Ramsey budget percentages and also dig into the spreadsheet side of things.

Tiller is a paid app that gives users access to dozens of financial templates. These templates allow you to customize your budget to fit your exact financial journey and goals. Plus, it exports seamlessly to Excel and Google Sheets.

Users also get the support of the entire online Tiller community and summary emails to help you keep a pulse on your spending and savings.

Try Tiller for free, or check out our full Tiller Money review for more details.

Other Budgeting Methods

Not sure these Dave Ramsey budget percentages work for you? That’s OK! There are several other budgeting methods worth exploring. The most important budgeting factor is to choose one that fits your finances.

The Paycheck Budget

Your paycheck drives a lot of your financial life, so why shouldn’t your budget reflect that? The paycheck budget method is a super simple and super effective budgeting method.

To get started, follow these steps:

  1. Determine how many paychecks you earn each month and approximate what you expect them to be.
  2. List out bills, their amounts, and their due dates.
  3. Plot out regular expenses, such as groceries, and irregular expenses, such as birthdays.
  4. Deduct your bills and expenses from your paychecks based on the dates you pay these bills and cover these expenses.

Following this method allows you to see what you can expect to have leftover after each pay period. Your obligations are covered and you might even have extra money to meet your savings and investing goals.

The 50-30-20 Budgeting Method

Another popular budgeting method is the 50/30/20 method. This budgeting method can help you ballpark your expenses and quickly determine if you are overspending in any area. With this method, you look at your income in three categories:

  1. Needs, such as housing groceries, and insurance, account for 50% of your income.
  2. Wants, including entertainment and shopping, take up 30% of your income.
  3. Savings, such as debt payoff, sinking funds, and investing, make up 20% of your income.

Of course, these percentages are approximations and may depend on cost of living and other factors.

The Emergency Budget

Hopefully you’ve already started to build an emergency fund. But do you have an emergency budget? You want to make sure that you know how to budget your money when times get tough. That’s why you should consider creating an emergency budget.

An emergency budget is an exercise that will help you identify which areas you can trim and which aspects of saving you might need to pause. Remember that this isn’t a permanent budget. It’s something you build to help you weather a financial storm.

Final Thoughts On Dave Ramsey’s Budget Percentages

One of the biggest hurdles budgeters face is making sure that their budget accurately captures all the different aspects of their financial life. That’s why Dave Ramsey’s budget percentages are so helpful. Even if you have to adjust the percentages for your specific situation, the thorough list of categories ensures that your budget isn’t leaving anything out.

Whether you are able to follow these percentages exactly or need to make some changes, set up your budget in a way that helps you spend less than you earn. That way, you can be certain that you are making forward progress on your journey toward financial freedom.

Jacob Wade

Jacob Wade

Jacob Wade has been a nationally-recognized personal finance expert for the past decade. He has written professionally for The Balance, The Spruce, LendingTree, Investing Answers, and other widely-followed sites. 
He’s also been a featured expert on CBS News, MSN Money, Forbes, Nasdaq, Yahoo! Finance, Go Banking Rates, and AOL Finance.

In 2018, Jacob quit his job and his family decided to sell everything (including their home) to take off on an adventure. They traveled the country in an RV for nearly 3 years, visiting over 38 states, 20+ national parks and eventually settling in the sunshine state!

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