Payday Allocation Calculator
Decide where your money goes on the day it arrives, not at the end of the month when it has already gone. Enter what lands and what is already committed, and see a split across bills, savings, investing and spending.
What this calculator assumes
- Every figure is monthly and in pounds. Enter your take-home pay, not your gross salary — tax, National Insurance, pension and student loan should already be gone.
- Committed costs are the ones that leave your account regardless of how careful you are that month. Only minimum debt repayments count here; extra repayments behave like savings.
- The suggested rate is a starting point calculated from your buffer, not a recommendation about your circumstances. Move the slider and the whole split follows.
- Time to a three-month buffer counts your savings allocation only. It ignores interest, so the real date is usually a little sooner.
- The three-month buffer target is three times your committed costs, not three times your pay.
- Nothing you type leaves your browser. There is no account, no sign-up and no data stored.
The suggested rates below are earmarkIQ’s own starting points, described in full under “How the suggested split is worked out”. They are not regulated financial advice and take no account of your personal circumstances, debts, dependants or goals.
Why allocate on payday rather than budget all month
Most budgets fail in the same way. You set category limits at the start of the month, spend against them for a fortnight, lose track somewhere around the third weekend, and find out how it went once the money has already gone. The tracking is honest but it arrives too late to change anything.
Payday allocation inverts that. Instead of watching money leave, you decide where it goes on the one day of the month when the whole amount is sitting in front of you. Bills are already spoken for. Savings and investing come out next, before they can be reclassified as spending money. Whatever is left is genuinely yours to spend, and you can spend all of it without checking anything, because the important decisions were made on day one.
The behavioural evidence behind this is well established. Payday is what researchers call a temporal landmark: a moment that feels like a fresh start, when people are measurably more willing to act on an intention they have been putting off. It is also the moment your account balance is at its most misleading — a month of committed costs is still to come out, but the number on screen suggests otherwise. Deciding the split immediately, while the balance is at its peak, is what stops the first week of the month eating the last.
Read more on the behavioural side in the fresh start effect and how to budget on payday.
How the suggested split is worked out
The calculator does two things. First it subtracts every committed cost from your take-home pay, which leaves the spare amount — the only part of your pay that is actually available to decide about. Then it suggests how much of that spare amount to put away, based on how deep your existing cash buffer is relative to your committed costs.
The logic is deliberately visible, because a number you cannot interrogate is a number you will not trust:
| Your buffer | Suggested rate | Savings | Investing |
|---|---|---|---|
| Under one month of costs | 50% | 100% | 0% |
| One to three months | 40% | 80% | 20% |
| Three to six months | 35% | 40% | 60% |
| Six months or more | 30% | 20% | 80% |
The pattern is that cash comes before growth. Until you have a buffer that covers a few months of committed costs, the whole allocation goes to accessible savings, because an investment you have to sell in a bad month is worse than the cash you did not have. Once the buffer is deep enough to absorb a broken boiler or a gap between jobs, the balance shifts towards investing, where the money has time to work.
The rate is a starting point, not an instruction. The slider is there because your circumstances are not in these four rows. If you are clearing an expensive debt, a lower rate with the difference going at the debt will beat any of this. If you have a wedding in eight months, a higher rate makes more sense than a rule about buffers.
A worked example
Take a monthly take-home of £2,942 with committed costs of £1,820 — £950 rent, £260 council tax and utilities, £320 groceries, £140 travel, £70 insurance and £80 of subscriptions. That leaves £1,122 spare. With £1,200 already in an emergency fund, the buffer covers 0.66 months of costs, which is under one month, so the suggested rate is 50% and all of it goes to savings.
That is £129.46 a week of spending money, £6,732 put away over a year, and a three-month buffer of £5,460 reached in eight months from the £1,200 already saved. The point of showing the weekly figure is that £561 a month is an abstraction, whereas £129 a week is a number you can hold in your head on a Friday night.
Making the split actually happen
A split you have calculated and a split you have executed are different things. Three mechanics do most of the work:
- Separate the money physically. Standing orders into a separate savings account and an investment account, dated for the day after payday. Money that never appears in your spending account cannot be spent from it.
- Give bills their own pot. Move the full committed amount out on payday too. What remains in the current account is then genuinely spendable, which removes the mental arithmetic entirely.
- Re-run it when your pay changes. A pay rise absorbed into spending is the most common way a good savings rate quietly decays. Recalculate whenever the number that lands changes.
The committed costs line is also where most of the easy money hides. Subscriptions creep, energy tariffs roll onto standard rates, and insurance auto-renews above the price you would pay today. Every pound you cut from committed costs moves straight into the spare amount, where you get to decide about it. Our subscription cost calculator shows what that drift compounds to over five years.
Frequently asked questions
Other calculators
This is the calculation earmarkIQ runs every payday
The split above is a snapshot from numbers you typed. earmarkIQ does the same thing continuously: it reads your committed costs from your actual bank transactions via Open Banking, spots when payday lands, and updates the allocation without you re-entering anything. It also notices when a committed cost quietly grows.