Earning under Dh10,000 a month in UAE? Here’s how to plan your budget

Vijay Valecha, Tue, Sept 29, 2026 Khaleej Times

The key is to prioritise essential expenses, avoid allowing lifestyle costs to grow with income and build a savings habit, even if the amount set aside each month is relatively small.

Khaleej Times asked financial expert Vijay Valecha, Chief Investment Officer at Century Financial, to share practical tips on how residents can manage their money, reduce expenses and build savings on a limited income.

How much of your salary should go towards rent?

Housing should be the first consideration when building a monthly budget, according to Valecha. He recommends keeping rent to around 30 per cent of monthly income, although the amount residents can afford will depend on their location and other financial commitments.

Rent: Aim to keep it at around 30 per cent of your monthly salary.

Utilities: Budget an additional 5-10 per cent of income.

If rent is too high: Consider shared accommodation, living further from major city centres or negotiating rental payment terms.

For someone earning Dh7,000 a month, allocating 30 per cent to rent would mean a budget of Dh2,100.

For residents earning just under Dh10,000, Valecha said studio apartments in areas such as Dubai's International City or Abu Dhabi's Khalifa City could cost around Dh30,000-Dh34,000 a year.

“Rent shouldn’t exceed 30 per cent of your monthly income,” he said.

Housing, transport and food can collectively account for around 60 per cent of monthly income, particularly for residents living in more expensive parts of Dubai and Abu Dhabi, Valecha said.

Transport and food are two areas where residents can review their spending and potentially reduce costs.

Valecha recommends allocating around 8-12 per cent of income to transport.

Using Dubai's Metro and bus network with a monthly Nol card can bring commuting costs to below Dh200.

By comparison, owning a car can cost Dh700-Dh1,000 or more a month when fuel, parking, insurance and loan repayments are included.

Aim to keep food spending at around 20 per cent of monthly income, Valecha recommends.

Cook at home more often instead of relying on restaurants and food delivery.

Buy groceries in bulk where practical and plan meals to avoid unnecessary spending.

Treat dining out as an occasional expense rather than a daily habit.

On a monthly salary of Dh7,000, allocating 20 per cent to food would give you a budget of Dh1,400.

“Food is probably the most underestimated budget category,” Valecha said.

Experts recommend treating savings as a planned expense rather than waiting to see how much money is left at the end of the month.

Valecha recommends transferring at least 15 per cent of income into a separate account when the salary arrives. However, he acknowledges that high housing and transport costs can make this difficult.

5-10 per cent: A starting point if your essential expenses leave little room for savings.

15 per cent: Valecha's recommended initial savings allocation.

Up to 20 per cent: A longer-term goal as your financial circumstances allow.

For someone earning Dh7,000 a month, saving five per cent would mean putting aside Dh350, while 10 per cent would amount to Dh700.

The first priority should be building an emergency fund that can cover three to six months of expenses, Valecha said.

Valecha advises residents to be cautious about relying on personal loans, credit cards and buy-now-pay-later schemes to cover everyday expenses.

Interest charges and repayment commitments can turn one-off purchases into longer-term financial obligations, making it harder to save.

Before taking on a new payment commitment:

Check whether you can afford the repayments after covering rent, utilities, food and transport.

Review the interest, fees and repayment terms.

Avoid taking on additional debt to maintain a lifestyle you cannot comfortably afford.

Valecha also cautioned against sending a large portion of income abroad before building sufficient savings locally, as this could leave residents without a financial cushion in an emergency.

Khaleej Times