Mad Hon · Balanced budget

Build a 50/30/20 budget in shekels

Build a 50/30/20 budget in shekels. A step-by-step Mad Hon guide for your Balanced budget score, written for olim.

1. Take the split as a reference point, not a rule.
Fifty percent of net income covers essentials, thirty percent covers choices, twenty percent goes to saving and to clearing debt faster than the minimum. The proportions are a starting reference, not a law of arithmetic. If they are unreachable on your income, 60/25/15 is a working target to start from and move up.
2. Work out net income from the payslip, not from the offer letter.
Israeli salaries are quoted as a gross monthly figure, and the gap to what arrives is wider than most olim expect. The tlush maskoret, your payslip, takes income tax, Bituach Leumi (national insurance) and health tax off the top, then your pension contribution and any keren hishtalmut contribution. Use the figure that reaches the account. Count a bonus or irregular freelance income separately rather than folding it into a monthly number, and if you still hold foreign income, count only what you actually convert and bring in.
3. Sort the essentials, and expect line items you never had at home.
Rent or mortgage, utilities, basic food, transport to work and essential insurance are the ones you already know. The Israeli additions are arnona (municipal rates, charged by the local authority), va'ad bayit (the building committee levy that covers cleaning, lighting and lift maintenance in a shared building), and bituach mashlim, the supplemental health cover most households buy on top of the public health fund. Several of these arrive every two months rather than monthly, which makes any single month misleading; annualise them and divide by twelve. Some local authorities discount arnona if you pay the year up front, so it is worth asking yours.
4. Name the choices, then stop apologising for them.
Eating out, travel, gym, entertainment, clothes beyond replacement. These are the costs you can pause in a bad month, which is the whole reason for separating them. Over thirty percent is a signal to choose where the money works hardest, not an instruction to cut everything.
5. Count the saving that already happens without you.
Before concluding you save nothing, add up what the payslip already moves: your own pension contribution, the employer contribution alongside it, the severance component, and both sides of a keren hishtalmut if you have one. Your own contribution is money you save out of pay; the rest is accumulation on top of it. Knowing which is which tells you how much of the twenty percent is still yours to arrange.
6. Set the transfer for payday, not for month end.
A hora'at keva, a standing order, dated to the day the salary lands moves the money before it is available to spend. Ordering matters more than the amount: expensive card debt first, then the buffer, then longer-term saving. One caution specific to an Israeli current account: it usually comes with an overdraft facility, so an over-ambitious standing order will go through anyway and simply deepen the overdraft. If that happens, the transfer was too big.

Build a 50/30/20 budget in shekels. A step-by-step Mad Hon guide for your Balanced budget score, written for olim.

1. Take the split as a reference point, not a rule.

Fifty percent of net income covers essentials, thirty percent covers choices, twenty percent goes to saving and to clearing debt faster than the minimum. The proportions are a starting reference, not a law of arithmetic. If they are unreachable on your income, 60/25/15 is a working target to start from and move up.

2. Work out net income from the payslip, not from the offer letter.

Israeli salaries are quoted as a gross monthly figure, and the gap to what arrives is wider than most olim expect. The tlush maskoret, your payslip, takes income tax, Bituach Leumi (national insurance) and health tax off the top, then your pension contribution and any keren hishtalmut contribution. Use the figure that reaches the account. Count a bonus or irregular freelance income separately rather than folding it into a monthly number, and if you still hold foreign income, count only what you actually convert and bring in.

3. Sort the essentials, and expect line items you never had at home.

Rent or mortgage, utilities, basic food, transport to work and essential insurance are the ones you already know. The Israeli additions are arnona (municipal rates, charged by the local authority), va'ad bayit (the building committee levy that covers cleaning, lighting and lift maintenance in a shared building), and bituach mashlim, the supplemental health cover most households buy on top of the public health fund. Several of these arrive every two months rather than monthly, which makes any single month misleading; annualise them and divide by twelve. Some local authorities discount arnona if you pay the year up front, so it is worth asking yours.

4. Name the choices, then stop apologising for them.

Eating out, travel, gym, entertainment, clothes beyond replacement. These are the costs you can pause in a bad month, which is the whole reason for separating them. Over thirty percent is a signal to choose where the money works hardest, not an instruction to cut everything.

5. Count the saving that already happens without you.

Before concluding you save nothing, add up what the payslip already moves: your own pension contribution, the employer contribution alongside it, the severance component, and both sides of a keren hishtalmut if you have one. Your own contribution is money you save out of pay; the rest is accumulation on top of it. Knowing which is which tells you how much of the twenty percent is still yours to arrange.

6. Set the transfer for payday, not for month end.

A hora'at keva, a standing order, dated to the day the salary lands moves the money before it is available to spend. Ordering matters more than the amount: expensive card debt first, then the buffer, then longer-term saving. One caution specific to an Israeli current account: it usually comes with an overdraft facility, so an over-ambitious standing order will go through anyway and simply deepen the overdraft. If that happens, the transfer was too big.