Budgeting Can Be Scary
There are a lot of people that approach the idea of budgeting with fear; this should not be so. Often the reason why people shy away from the subject is that they have little or no experience with budgets.
You have to understand that budgeting does not mean that you will have to start scrimping and saving and living your life like a miser.
No, it just means that you are getting to understand your finances and that you will have total control over them.
So, how do we explain what a budget is?
Let's break it down
A budget is a detailed description of what is coming in (income) and what money is going out (expenses), this is your savings and expenses.
Knowing how to save money when you get paid every week, two weeks, or monthly is a skill. Most people don’t see the importance of following a strict budget plan. The importance is the difference between having money left over and not. It’s as simple as that in the long run.
However, when you get paid, either weekly, bi-weekly, or perhaps monthly, budgeting and saving could seem much more difficult. But it is worth it in the end.
After all, a lot of bills go out every month. So, it can seem like by the time the week’s up, after you’ve gone grocery shopping and other expenses, your paycheck is gone. Which means that you are practically broke.
Fortunately, there is a cure to lessen the burden of weekly or bi-weekly paychecks shortage after paying your weekly and monthly bills.
Below I have put together a quick and easy to follow guide on how to budget your income.
Quick and Easy Guide To Budgeting
1. Identify your bill dates and expenses
When you get paid once every week or two weeks, one of the most important things you can do is keep track of your bills and expenses. You need to know exactly where your money is going.
Carefully take a glance at how much you spend your income this includes food every week, entertainment, household bills, and living expenses. Record individual daily costs – including drinks, movies, or magazines.
By performing this, you not only determine how much you need to save, but you will have ta better understanding of how you are spending. Knowing exactly what you are spending your money on can really put things into perspective. You may not know you’ve spent $55.00 on coffee and donuts per week until you write it down.
So, track your bills and expenses with pen and paper, or you can create or download a weekly spreadsheet.
2. Reschedule bills when you have too many in one week
Let’s say for example that your electricity, mortgage, cell phone, and internet bill all fall in the same week, this is the perfect time for you to call each company and ask them if they can help you by changing your due dates to varying different dates.
This method could be a little dicey, that’s why you must approach it tactfully. What you must do is to take out the time to explain to them how much easier it would be for you financially if you could change then due date.
If you do this correctly, then chances are you won’t be overwhelmed with too many bills and not enough money. Or as the saying goes, “too much month at the end of your money.”
3. Outline your budget week by week
Now once you have all your bills sorted out, it is time to make a week by week budget. You should do at least four weeks so you can have the entire month’s view of your budget.
Remember to practice this kind of budgeting every time you have a pay change or introduce a new expense. Under each week, you should have all your bills that are due and your weekly expenses.
On weeks that you have leftover cash, you can decide to send it to your bank account or put it in savings. If you have nothing left then you need to rethink your spending habits and reduce some expenses. Here is a sample budget for you to emulate below. Now, this isn’t typical as budgeting is relative according to lifestyle. But the idea is the same.
Example Budget Outline
Gas (car): $50
Car payment: $409
Car insurance: $162
Car maintenance: $60
Extra to Debt: $ 440
Medical Bills: $60
Term Life Insurance: $73
Student Loan: $500
Groceries(2 weeks): $500
Fun Money: $50
Now, this budget is based on a weekly income of $1,500 each week. You will notice from the example of how the Daycare and Mortgage aren’t due in the same week.
That’s because they are the more massive bills, and therefore should be separated far from each others date. You will also notice that in week 3, the budgeted amount for groceries is for two weeks instead of one.
It’s a strategy that is all about spreading out your expenses so you can better handle your bill load.
The Next Steps Are As Follows
4. Offset your debts as soon as possible
When you have accumulated a lot of obligations, putting money away into your savings can be difficult. It would help if you worked towards reducing some of your debts as soon as possible.
Start by eliminating the unnecessary bills like, entertainment streaming services, social media account fees, low credit cards that can be paid off quickly, magazine subscriptions, and any other known non-necessities.
Cutting back on expenses like cable subscription and eating out, together with making use of coupons when you shop can help you save money that you can put towards clearing your debts. Once you are back on track, you can get those things once again.
5. Don’t quit. Keep at it!
Budgeting takes time to master; it’s not something you can be a pro at overnight. It is said that you need at least 3 to 4 months to learn budgeting.
No doubt, you will miss an expense or over spend in the beginning. Don’t worry. It would be best if you just pat yourself on the back (for the good stuff) and keep moving because you are in this for the long haul.
You should also take quality time to make a joint budget with your spouse (if you’re married), sit down together and create weekly plans, and try to stay on track.
Follow the five steps, take the time to plan out your budget, and don’t be afraid to make adjustments as you go to see what works best for you.
I understand that budgeting weekly can be a little more complicated. Receiving your paycheck weekly or bi-weekly could present the temptation to squander all your money at once.
Avoid this by all means possible. Focus on the big picture and how much better you will feel once your finances are in control. Also, image having a savings that you can rely on in times of need. Check out our saving tips in How to save like its raining. Good luck, I know you can do it!