Disposable income is what households can spend or save. The U.S. personal saving rate has averaged around 4–6% of disposable income in recent years (BEA).
How to use the Disposable Income Calculator
- Gross income
- Income taxes (federal, state, local)
- Payroll taxes (FICA)
- Saving per year
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter gross income, income taxes, payroll taxes and your planned saving.
Tips
- Use real (inflation-adjusted) figures to compare across years.
- Check whether data are seasonally adjusted.
- Use the same currency and base year throughout.
- Economic models simplify reality – treat results as illustrations, not forecasts.
Common mistakes to avoid
- Mixing nominal and real values.
- Comparing percentage changes with percentage-point changes.
- Treating correlations as causes.
Inputs explained
| Field | What to enter |
|---|---|
| Gross income | Amount in your currency |
| Income taxes (federal, state, local) | Amount in your currency |
| Payroll taxes (FICA) | Amount in your currency |
| Saving per year | Amount in your currency |
What each result means
- Disposable income = [Gross income] – [Income taxes (federal, state, local)] – [Payroll taxes (FICA)]
- Per month = [Disposable income]÷12
- Consumption spending = [Disposable income] – [Saving per year]
- Saving rate = [Saving per year]÷[Disposable income]×100
- Total tax rate = ([Income taxes (federal, state, local)] + [Payroll taxes (FICA)])÷[Gross income]×100
Example values
How the main result changes when Gross income changes and everything else stays at the example values above:
| Gross income | Disposable income |
|---|---|
| 40,000 | 21,880 |
| 60,000 | 41,880 |
| 80,000 | 61,880 |
| 100,000 | 81,880 |
| 120,000 | 101,880 |
| 160,000 | 141,880 |
Formula
Disposable income = gross income − income taxes − payroll taxes (Social Security, Medicare)Personal saving rate = saving ÷ disposable incomeWorked example
Inputs — Gross income: $80,000; Income taxes (federal, state, local): $12,000; Payroll taxes (FICA): $6,120; Saving per year: $6,000.
Results — Disposable income = $61,880.00; Per month = $5,156.67; Consumption spending = $55,880.00; Saving rate = 9.7 %; Total tax rate = 22.65 %.
Frequently asked questions
What is disposable income?
Income after taxes – available for spending and saving.
Is disposable income the same as take-home pay?
Close – take-home pay also deducts retirement and benefit contributions.
Why does disposable income matter?
It drives consumer spending, the largest part of GDP.
What formula does the Disposable Income Calculator use?
Disposable income = gross income − income taxes − payroll taxes (Social Security, Medicare).