It can be difficult to figure out how to put together a puzzle without knowing the entire picture. The same is true for making a monthly budget when you get paid weekly.
Although the idea of getting paid weekly might sound ideal, it actually makes budgeting a bit more complicated.
In this post, we’ll break down the exact steps for how to budget weekly paychecks.
Step 1: Mark Your Paydays and Bill Due Dates on a Calendar
The first step is to know when your paychecks are coming, especially if you have direct deposit, and when your bills are due.
Mark your calendar with your paydays and monthly bills (including utility bills, credit cards, car payments, student loan payments, your mortgage payment, any other debt repayment, etc.).
This will help you see which of your bills are due around the same time as you get your weekly pay.
By visually plotting your income and expenses, you’ll be able to avoid the stress of not having enough money available to pay monthly expenses by simply focusing on the ones coming up before you get paid again.
>> Use this free Calendar Budget Planner to start tracking your paydays and bill due dates
Step 2: Make a List of Your Other Expenses
It’s easy to forget about common everyday expenses that don’t typically have due dates. Things like groceries and gas are often overlooked and underestimated.
Look back at previous bank statements and/or start tracking your weekly spending to get a better idea of how far your money needs to go and whether you should start cutting expenses.
It may also be helpful to separate your essential spending from your discretionary spending.
Recognizing which discretionary expenses and budget categories can be scaled back will help you increase cash flow and give you some extra cash to save toward your financial goals.
>> Download a free expense tracker to help see where you’re spending your money
Step 3: Determine Which Expenses Will Come Out of This Week’s Paycheck
Once you have all your income and expenses recorded, it’s time to figure out what you need to worry about right now.
Look ahead to what regular bills and fixed expenses you have coming up until your next paycheck.
Make paying those your priority.
Then add up the more variable weekly expenses you expect to have.
If you’re planning on spending more than you’ve got left, it’s time to cut back a bit.
What can you put off for another week or eliminate entirely?
Step 4: Write Your Budget Out
After you’ve got your numbers in front of you it’s time to write it all out in a way that helps you visualize where your money needs to go.
It may be tempting to think you can budget weekly in your head, but it’s better to get it down on paper.
Not only does a written budget help you stick to your spending plan, but it also helps you understand where you’re spending your money.
What happens when you have too many bills due at a time?
You may notice as you fill in your calendar that several bills all fall around the same time, eating up the bulk of your paycheck that week.
There are several tactics you can try to avoid this problem.
Change your bill due dates
Many companies will allow you to choose your due date.
Call your provider or lender to request your bill be moved to a different day that helps you spread out your bills across multiple paychecks.
Work with your lenders when you can’t meet your due dates
Businesses are usually happy to work with you if you’re having a hard time making your payments.
Some options may be adjusting due dates, waiving late fees, extending grace periods, or lowering interest rates.
Be creative about how you budget your money
It might be that there is no way around the problem of too many bills coming in at once.
If that’s the case, you’ll need to cut back on some expenses.
The best way to do this is by being creative about how you budget your money.
Make a meal plan and eat at home instead of eating out or invite friends over rather than going to the movies.
Those kinds of small changes will help you stretch your budget further and make it easier to pay what you owe.
Earn some extra income
If you’ve cut your spending as much as possible but still have extra expenses it’s time to start looking for ways to make more money.
What kind of side job can you start that will only take a few hours out of your week?
Working part-time or getting a second job is an easy way to bring in some extra income, which may be enough to help you get through a tough time.
Quick Tips To Make Weekly Budgeting Easier
Budgeting weekly is a great way to get an understanding of exactly where you’re spending your money and whether that spending is helping you reach your goals.
However, it’s easier to get caught by surprise with unexpected expenses since you’re focus is more narrow.
To avoid these budget-breaking surprises, make sure you’re incorporating them into your weekly budget.
Here are some tips to make sure you’ll be prepared.
Create sinking funds for expected upcoming expenses
We often forget about intermittent and irregular expenses until it’s too late, leading to increased credit card usage and added debt.
To plan ahead for these expenses follow these steps:
- Take a look at what infrequent expenses are going to be coming up for you – holidays, birthdays, insurance premiums, etc.
- Determine how long you have before the expense is due.
- Decide how much you want/need to save.
- Take the amount you want to save and divide it by the number of weeks until you need the money. The result is how much you should save each week.
- Start saving this average amount weekly.
For example, say you’ve got a wedding to go to in 2 months and expect to need $600. Divide 600 by 8 (amount needed/weeks left) to get 75. You’ll need to save $75 each week to make sure you hit your goal.
Set up an emergency fund
It’s always a good idea to have money set aside for unexpected expenses. But it’s hard to know how much to save and what exactly constitutes an “emergency.”
As a general rule of thumb, a good starting point for your emergency fund is enough to cover a month’s worth of expenses.
If that feels like an impossible target, just start small.
Get in the habit of saving on a regular basis, just a little bit each pay period. This is the first step and easiest way to improve your financial situation.
The idea is you want enough that if some unexpected expense pops up you won’t have to take on debt to get through it.
Eventually, you want an emergency fund that will cover several months in case of job loss.
Keep your spending money in a separate bank account
An effective way to make sure you’ve got enough money to pay your bills is to use separate accounts: one for bill pay and one for spending.
Automation can help you avoid late fees and having a separate account for your bills ensures you always have the funds to cover the automated withdrawals.
Just remember to treat your bill pay checking account as untouchable. The last thing you want is payments that bounce or overdraft fees.
As for your spending account, one tip to make sure you don’t overspend is to withdraw what you need for the week and only use cash.
Studies have shown that using cash can actually affect your spending behavior and save you money.
Not only is there a psychological barrier to spending cash, but you’ll also be more aware of how much you have and what you’re spending it on.
Make partial bill payments with every paycheck
Some larger expenses, like a mortgage or rent payment, might be big enough that your weekly paycheck won’t cover the full payment.
In this case, consider making partial weekly payments to those bills each pay period.
Just make sure to check with your lender to verify they’ll accept a partial payment.
If not, you can make these “payments” into your bill pay checking account each week so the money is there when you need it.
Keep your goal in mind
Any budget is only successful if you can stick with it.
If you’re more focused on restrictions than your goals, you’ll have a hard time making a budget that works.
Keeping your goals in mind will help you stay on track and focused.
Final Thoughts on How to Budget Weekly Paychecks
If you’re paid weekly, it can be tough to keep track of your budget, but using the
Adopting a paycheck budgeting method will help you take control of your money and make sure you have enough to cover your daily expenses as well as being able to set aside money for your savings goals.
It may sound ironic, but budgeting by paycheck can be a great way to break the paycheck to paycheck cycle, helping you pay off credit card debt, develop positive spending habits, and reach your savings goal.