A common US guideline is to keep rent and utilities at or below 30% of gross income, which is income before tax. On 54,000 a year that is about 1,350 a month. This calculator shows the 30% figure, lets you choose a different share, and checks a specific rent against the US housing cost-burden measure.
Where the 30% figure comes from
The US Department of Housing and Urban Development counts a household as cost-burdened when it spends more than 30% of income on housing costs, and as severely cost-burdened above 50%. The US Census Bureau reported that in 2023 nearly half of US renter households, 49.7%, were cost-burdened. The measure describes housing pressure across many households; it is not a rule written for your budget.
A worked example
Jordan is hypothetical and the example uses US dollars. These are teaching figures, not typical rents or a landlord’s approval criteria.
Jordan earns 54,000 a year before tax, which is 4,500 a month. At 30%, the housing budget is 1,350. At 25%, it is 1,125. Jordan is considering an apartment at 1,600 plus about 150 in utilities. That 1,750 is 38.9% of gross income, above the 30% line but below the 50% severe line.
Gross income versus take-home pay
The cost-burden measure uses gross income. Your budget runs on take-home pay, which is lower after tax and deductions. Check the rent you are considering inside your full monthly plan with the monthly budget template or the 50/30/20 budget planner, which both use income after tax.
When the guideline does not fit
In high-cost cities many renters pay more than 30%, and some households can afford less than 30% because of childcare, debts or irregular pay. Landlords may also use their own income checks. Remember move-in costs such as a deposit and first month’s rent, and plan for them separately with the savings goal calculator. This page describes a US measure; outside the US, check local guidance.
The 49.7% statistic describes 2023, not the current share of renters. Display currency changes labels only: enter income, rent and utilities in the same currency. Arithmetic works with your own figures, but the US thresholds do not become local rules when you select another currency. The tool does not calculate deductions, rent assistance, lease eligibility or what you can safely afford; it is general education, not personalized advice.