Personal finance: 3 steps to a clear overview

Step 1: Know your disposable income

Everything starts with one number: your disposable income, what you have left once fixed expenses are paid. An example: Money in 32,500 DKK − Fixed expenses 18,200 DKK = Disposable income 14,300 DKK.

• Money in, what you actually receive, typically your take-home pay
• Fixed expenses, housing, insurance, transport, loans, subscriptions
• Disposable income = Money in minus fixed expenses
• Upload your bank statement in Reelt, and get your own figure, not the example, in a few minutes

Step 2: Allocate the rest sensibly

Once you know your disposable income, you can allocate it without counting the same expense twice. Transport, insurance, and similar items belong with the fixed expenses above, not here:

• Necessities: Food, household items, purchases you can't avoid
• Wants: Experiences, hobbies, dining out
• Savings: Emergency fund, pension, or future goals

Step 3: Build a buffer

An emergency fund is what stops a single unexpected bill from derailing the whole budget:

• Start by saving up a few months' worth of fixed expenses
• Automate the savings, transfer a fixed amount on payday
• Once the buffer is in place, you can prioritize debt, investing, or bigger goals

Frequently asked questions

• Where should I start with my personal finances? With your disposable income. It's the foundation every other decision, budget, savings, debt, is built on.
• What is a good disposable income? There's no single right answer, it depends on your income, your fixed expenses, and your household. Work out your own number instead of comparing to an average.
• How do I prepare for a bank meeting? Calculate your disposable income with Reelt, and download a report. The bank wants to see your actual number, not an estimate.