How to Calculate Bills
- 1). Gather and organize the most recent statements for all of your bills and expenses. Statements help provide an accurate calculation.
- 2). Calculate fixed expenses by tallying these expenses. Examples of fixed expenses include car payments, mortgage payments and insurance premiums. Fixed expenses represent expenses which remain constant each month.
- 3). Calculate variable expenses. Variable expenses fluctuate over time and include electric bills, telephone bills and other utility bills. Use statements covering three billing cycles to estimate the average expense for utilities.
- 4). Take into account fixed quarterly and yearly expenses. These expenses can include car insurance and homeowners insurance. Convert quarterly and yearly expenses to monthly amounts by dividing the total amount due by the number of months in the billing cycle. For instance, to calculate the monthly expense of an insurance policy covering a one year period, take the total amount due and divide by 12.
- 5). Combine fixed and variable expenses. Calculate your household bills by combining your total fixed expenses and your total variable expenses. This represents the portion of your income required to meet monthly financial obligations.
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