Budget: how to calculate and optimize your monthly living allowance?

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Food shopping, clothing, outings and “pleasure” expenses… It is with your monthly “rest to live” that you can pay for them each month. This sum corresponds to what you “remain” each month when you have paid all your expenses.

Depending on the salary, but also the expenses of each, it can vary completely… But is there a minimum, to “live well”? And how to calculate it correctly, and above all, to inflate it?

First of all, it is essential to fully understand the notion of remainder to live, essential in terms of managing the household budget.

Identify first of all the nature of your fixed and recurring expenses each month, for example:

Then, clearly establish what your monthly cash flow is, i.e.:

To calculate your remaining life, the formula is very simple. Just subtract your expenses from your income. Be specific, and make sure you don’t forget any expenses. To make your job easier, you can consult your account statements over several months, in order to identify the sums that come back each time.

This rest to live thus serves you, each month, to… live. And to pay for all your daily expenses: food, clothing, outings, leisure, etc. But also to build up savings.

Obviously, its amount varies according to the salary, the charges but also the number of dependents per household.

Thus, it is estimated that the minimum remainder to live to live properly is around 700 euros per month for a single person, and 400 euros when they are in a couple.

“The amounts can be increased by 300 euros per dependent. The remainder to live for a couple with three children will therefore be 1700 euros. For a family living in Paris, the rest to live will be increased by 100 euros per person, which makes us 2200 euros for our Parisian family”, specifies the Compareil.fr site.

There are, however, several techniques to increase the amount of your remaining to live over the months, and gain in comfort.

First of all, it is necessary to hunt for superfluous expenses! Review all your subscriptions and contracts: cancel those that are not really useful to you. If you find them essential, try to find them cheaper elsewhere.

Then, make efforts to reduce your energy bills, one of the biggest expenses in the household.

Finally, if you have debts to repay every month, find out about solutions such as buying back credits, to reduce your monthly payments.

Because the remainder to live is also used by the banks, to determine whether, yes or no, a household can obtain a bank loan.

Indeed, financial institutions assess, for each loan application, the risk of default of the borrower, that is to say, the possibility that the latter will not be able to repay his due.

To estimate it, although there are no fixed rules in this area, and each bank has its own practices (some include taxes, others do not, for example), the establishment will however ask an essential question: will the debtor have enough money left to live on once his monthly payment has been withdrawn?

To do this, just look at what you will have left in your pocket once you have paid 33% more of your income, or the debt ratio.

In some cases, however, if your cash inflows are particularly substantial, the banks may grant you a debt ratio above 33%, if, once again, they deem your remaining living sufficient.