Calculating a loan budget: which income and expenses count?
Prepare a loan budget correctly: record net salary, family costs, health insurance, taxes and commitments without omissions or double counting.
Updated on · Budgetcredit
A good loan budget shows what is reliably left each month. It requires verifiable income, complete costs and a clear distinction between personal household planning and the statutory affordability assessment. A short questionnaire is helpful, but missing expenses must not disappear as a result.
Start with your net salary and the main cost categories. Then clarify only the details relevant to your situation. This keeps preparation simple and the calculation reliable.
Personal budgets and credit assessments serve different purposes
Your household budget reflects everyday reality. It also includes, for example, planned reserves and expenses you personally want to maintain. Alongside this, a bank must follow the legal requirements for the affordability assessment.
For cash loans within its scope, Article 28 KKG refers to the subsistence minimum guidelines of the canton of residence. The law also lists the rent actually owed, taxes owed according to the withholding tax table and commitments reported to the information office. A freely chosen list of expenses does not replace this assessment. KKG, Art. 28
Conversely, a positive assessment does not guarantee that an instalment will feel comfortable in your individual daily life. Both perspectives should be compatible.
Net salary: one clear starting figure is enough
Use your regular net salary and note which deductions it already includes. An initial overview does not require you to enter the same salary again as a gross amount. What matters is that the figure used is consistent with the costs deducted afterwards.
Withholding tax is a typical source of errors: if it has already been deducted from the salary paid out, it must not appear again, unchanged, as an additional payment in your personal budget. Other deductions, such as costs charged directly, should also be identifiable.
For irregular income, a single month says little. Show the fluctuations and plan cautiously for your personal budget. One-off income can increase a reserve, but it is not ongoing monthly income.
Shared households: allocate income and costs correctly
If you are married and live in a shared household, both net salaries and joint costs should be known for a clear household overview. For an unmarried couple, the actual division of expenses and household circumstances also matter.
This does not mean every franc of the other person’s income is automatically available for your loan. The household budget, allowable contribution and legal joint liability are separate questions. The lender must assess them in the particular circumstances. Merely listing someone’s income in an overview does not make that person a co-debtor.
A consistent approach matters: do not subtract all family expenses from only one income if the calculation is intended to represent a joint household budget. Equally, do not add two incomes together and then count only one person’s expenses.
Housing, health insurance and children
Record housing costs including the relevant ancillary charges. If you share costs with others, make clear whether you are entering the total or your share. Do not switch this basis between fields without noticing.
A family overview must include health insurance premiums for all family members covered by the calculation, including children. A premium subsidy reduces the actual cost; it must not then be counted again as another full benefit. Deductibles and co-payments should be included in your personal provision for healthcare costs.
Children may generate other necessary expenses, such as childcare or maintenance. The legal treatment and basic allowances used depend on the applicable rules. Zurich’s circular illustrates that basic allowances differ by household and children, and that health insurance costs, after allowing for premium subsidies, are relevant. Zurich’s rules do not replace those of all other cantons. Canton Zurich: subsistence minimum guidelines
Taxes: unknown does not mean zero
For personal planning, set aside a justifiable monthly tax reserve where tax has not already been included. Use suitable, current documents and account for changes in your circumstances. An earlier bill may no longer fit after a job change or a change in the household.
The KKG assessment has its own requirement through its reference to the withholding tax table. It must therefore remain clear whether an amount is your personal reserve or an item in the statutory calculation. The two values must not silently be treated as identical. KKG, Art. 28 para. 3
If you do not know a figure, have it clarified. An empty field or “I don’t know” does not justify assuming zero and producing an inflated borrowing capacity.
Existing commitments and irregular expenses
Declare current loans, leases, maintenance and relevant card commitments. An existing loan does not disappear from the assessment because its instalment is small. For consumer loans not yet repaid, the statutory assessment also includes the 36-month rule. KKG, Art. 28 para. 4
For your personal budget, convert annual expenses into monthly amounts. CHF 600 a year equals CHF 50 a month. Remember costs that only occasionally appear on your account. Looking solely at a low-expense month can easily overstate the amount consistently available.
Avoid double counting
A basic allowance may already cover certain living expenses. Deducting the same items in full again makes the calculated capacity too low. Conversely, failing to include necessary expenses either in the allowance or separately makes it too high.
For every calculation, therefore, check which expenses are already included and which are additional. This is more useful than filling in as many fields as possible. A good calculation explains its assumptions and identifies unclear information.
A short preparation checklist
| Have ready | What to check |
|---|---|
| Net salary and income documents | Deductions already included and fluctuating components |
| Household and children | Who is covered by the calculation? |
| Housing costs | Total or your own share |
| Health insurance premiums | All relevant family members; count subsidies once only |
| Tax information | Do not assume zero if the amount is unknown |
| Existing commitments | Include all current loans, leases and maintenance |
| Annual expenses and reserves | Convert to monthly amounts for personal planning |
Frequently asked questions
Do I need to record every receipt from everyday shopping?
Not for an initial overview. Meaningful cost categories are sufficient. The lender may request evidence for individual items during the later assessment.
Why does a loan calculator ask for my canton?
Because the statutory assessment for cash loans within its scope refers to the subsistence minimum guidelines of the canton of residence. A single allowance for all Switzerland does not reliably reflect these.
Is my budget remainder the same as the possible loan instalment?
Not automatically. The statutory calculation and provider’s assessment may differ. Your personal planning should also leave sufficient room for unexpected expenses.
From a budget to a suitable loan amount
Once the fundamentals are correct, you can put your borrowing capacity into perspective. For unclear items, seek personal advice from Budgetcredit.
A budget overview provides an indication and does not replace assessment of the application. Credit must not be granted if it would lead to over-indebtedness.
