A simple monthly budget on a salary in India

Most budgets fail for a boring reason: they are built on the wrong number, then never looked at again. You plan around your CTC, a card bill arrives that you forgot to count, and by the 20th the plan feels like fiction.

A budget that survives does not need to be clever. It needs to start from the money that actually lands in your account, give every rupee a job, and get a short review once a month. Here is a simple system for a salaried person in India, with a worked example.

Start from your in-hand salary, not your CTC

Your offer letter shows cost to company. Your bank account sees something smaller. Between the two sit deductions such as TDS (income tax deducted at source), your contribution to provident fund, professional tax in some states, and sometimes employer-provided insurance or meal-card components.

Open your last three payslips and note the net pay credited to your account. If it varies because of overtime, incentives or a mid-year tax adjustment, use the lowest of the three as your planning number. Anything above that is a pleasant surprise you can direct to a goal, rather than a shortfall you have to explain.

Tip: treat annual bonuses and arrears as separate events. Decide what each one is for when it arrives, instead of letting it quietly fund a month of extra spending.

Fixed, variable and annual costs

Before you split money into buckets, sort what you spend into three kinds:

• Fixed monthly costs — rent, EMIs, school or tuition fees, SIPs you have already committed to, phone and internet plans, domestic help. These barely change month to month.
• Variable monthly costs — groceries, fuel and cabs, eating out, shopping, electricity (which swings with the season). These are where budgets usually leak.
• Annual or irregular costs — health and vehicle insurance renewals, festival spending, a wedding in the family, annual subscriptions, a phone replacement every few years. These are the costs that wreck a month when you forget them.

The trick for the third group is to turn it into a monthly number. If your health insurance premium is ₹18,000 a year, set aside ₹1,500 a month for it. When the renewal arrives, the money is already sitting there.

A simple bucket approach

Once you know your in-hand number, split it into a small number of buckets. A common starting point:

1. Needs — rent, groceries, utilities, commute, insurance set-asides.
2. Goals — emergency fund, savings and investments, a down payment, paying off a loan faster.
3. Lifestyle — eating out, shopping, travel, hobbies, subscriptions.

Many people also add a fourth bucket: family support. Treat all of this as a starting point, not a rule. Rent in your city may push needs to half your income; living with family may free far more for goals. Buckets make trade-offs visible; they are not a textbook ratio to hit.

A worked example: ₹75,000 in hand in a metro

Meet Ananya, 28, who works in Bengaluru and receives ₹75,000 in hand each month. She shares a flat, sends money to her parents in Jaipur, and has one credit card. Here is how her month might look:

Bucket	Line	Monthly amount
Needs	Rent and maintenance (shared flat)	₹22,000
Needs	Groceries and household supplies	₹7,000
Needs	Electricity, phone, internet	₹3,000
Needs	Commute (metro, autos, cabs)	₹3,500
Needs	Annual insurance set-aside	₹1,500
Goals	Emergency fund	₹5,000
Goals	SIPs and other savings goals	₹10,000
Family	Sent home to parents	₹8,000
Lifestyle	Eating out and outings	₹6,000
Lifestyle	Shopping	₹4,000
Lifestyle	Subscriptions	₹1,000
Buffer	Unplanned, small surprises	₹4,000
Total		₹75,000

That works out to roughly ₹37,000 for needs, ₹15,000 for goals, ₹8,000 for family, ₹11,000 for lifestyle and ₹4,000 of buffer. Notice the buffer: a budget with zero slack breaks the first time a friend has a birthday dinner. If the buffer is unused at month end, Ananya moves it to her emergency fund.

Sending money home to parents

For many salaried people, supporting parents is not optional and not a “lifestyle” choice. Give it its own line with a fixed amount, sent on a fixed date — ideally the day after salary arrives. That does two things: your parents can rely on it, and you stop treating it as whatever is left over.

If you also pay for things directly — a parent’s medicines, an electricity bill at home, a sibling’s fees — record those under the same family line so you can see the true monthly total. People are often surprised that “₹8,000 a month” is really ₹12,000 once the direct payments are counted. If a sibling shares these costs with you, keep a clear record of who paid what so the conversation stays easy; our post on tracking money lent to friends and family covers that side.

Build the emergency fund first

An emergency fund is money you can reach quickly when something goes wrong: a job gap, a hospital visit, an urgent trip home. A widely used guideline is three to six months of essential expenses, but even one month is a huge improvement over nothing.

Using Ananya’s numbers, her essentials (needs plus family support) are about ₹45,000 a month. Three months is ₹1,35,000. At ₹5,000 a month that takes a while, so she also sends any unused buffer and part of her annual bonus there. Keep this money somewhere separate from your everyday account so it does not get spent by accident, and decide in advance what counts as an emergency. A sale is not one.

Credit cards inside a budget

Credit cards are where many careful budgets quietly fall apart, because the money leaves your bank account weeks after you spent it. The rule that keeps things straight:

Card spending counts in the month you spend, not the month you pay the bill.

If Ananya buys ₹3,000 of groceries on her card on 12 September, that is September grocery spending. When she pays her card bill in October, that payment is not new spending — it is simply moving money from her bank account to clear a debt she already counted. Counting it again would make October look ₹3,000 worse than it was.

A few habits help:

• Treat your card’s available limit as borrowing capacity, never as money you have. Our post on why your credit card limit is not money you have goes deeper.
• Pay the full statement amount by the due date where you can; interest on a revolving balance can undo months of careful budgeting. Check your card’s terms for how its billing cycle works, and see statement date vs due date.
• Keep enough in your bank account to cover the card spending you have already recorded for the month.

The 20-minute monthly review

A budget is a plan; the review is where it becomes useful. Pick a fixed day — the first weekend after salary is a good choice — and spend twenty minutes on this:

1. Check last month’s actuals against each bucket. Where did you overspend, and was it a one-off or a pattern?
2. Clear the card picture. Confirm last month’s card spends are recorded and the bill payment is scheduled.
3. Look ahead at annual costs. Is an insurance renewal, festival or trip coming in the next two months?
4. Adjust one thing. Not five. If eating out ran ₹2,000 over, either raise that line and lower another, or decide on a concrete change.
5. Move the leftovers. Any unused buffer goes to the emergency fund or a goal before the new month starts.

Twenty minutes a month beats a spreadsheet you abandon by March.

How Rovezi helps

Rovezi gives you one private place to see your bank, cash and card accounts together. Card spends show up as spending when you make them, and card bill payments are recorded as transfers between your own accounts, so they are never counted twice. Card limits are never added to your available money.

You can set up rent, EMIs, SIPs, insurance premiums and subscriptions as recurring bills with reminders a chosen number of days before they are due, import your bank’s CSV statement and review every line before it is posted, and use spending reports for your monthly review. See all the features, or read how we handle security. Rovezi is free during early access — create your account from the box below.

This article is general information, not financial advice. Names and amounts are fictitious.