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Checking our bank account during payday can be both exciting and overwhelming. We start to imagine all the stuff we can finally check out of our online shopping cart.
Suddenly, there’s a voice in the back of our heads saying that we have bills, necessities, and commitments to pay.
With the rising cost of living and silent inflation, having extra money set aside might seem like a privilege only a few could have. But that’s not entirely true.
Below are some tips and tricks on how to budget with a weekly pay:
Prioritize Needs Over Wants
One of the perks of getting paid weekly is that you will have a steady flow of cash from one week to the next. So, it is much easier for you to get distracted and spend your money carelessly.
Moreover, the pay isn’t as big as getting a monthly paycheck. Once you blow your budget for the whole week, you will have to double the amount you need to pay for essentials that you should’ve paid in the previous week.
Prioritize your bills and essentials before splurging on your wants. For instance, you can clear your electricity and water bills, rent, and health insurance and spend the rest of your money on groceries during the first two weeks.
Keep your shopping lists for the third or fourth week. This trick will ensure you don’t splurge on unnecessary items before spending on basic living necessities.
Create a Weekly Cash Flow Record
Knowing how your money comes in and out of your bank account is essential to developing healthy spending habits. Hence, it is better for you to record and track your weekly spending to avoid buying the same thing twice.
You can write all your weekly expenses in a notebook or create an Excel spreadsheet. We suggest you make a digital record using any expense tracker application you can find online.
Having a digital copy is much safer and more convenient. Plus, you can instantly make a record right after your recent purchase.
At the end of the week, check the list and plan your spending for the next week.
Know Your Pay Day
Knowing when you receive your money can ease your mind and let you plan your weekly spending. You can set an alert on your phone or mark the date on your table desk calendar.
The last thing you need is to stress yourself out for not having enough money just because you spend everything instantly and have to wait for at least six days for the next payment.
Limit Your Weekly Spending
There is only so much you can buy when you get paid weekly. Hence, you should limit your spending for the week if you have extra money left.
Keep the money in a piggy bank or a separate bank account. Repeat this method until the end of the month.
Once you enter a new month, you can use that money to cover current expenses without worrying that you’ll go penniless before your next payment.
Spread Your Bills’ Due Date by a Week
There might be some weeks when you can’t pay all the important bills at once. If possible, contact the relevant providers and ask for a readjustment of the payment due dates.
If they can’t extend the dates, spread the bills by a week. Pay the electricity and water bills during the first week and settle the rest in the upcoming week.
You can also arrange the bills by first paying the ones that don’t have flexible dates.
Follow the Three-Days Buying Rule
In this modern era, we are constantly bombarded by advertisements from e-commerce stores through social media and almost any application we have on our smartphones. With just one click, we can buy anything we desire whenever we want.
The rise of alternative payment methods like “Buy Now, Pay Later” also makes it hard for some consumers to reduce their impulsive spending habits. However, you can always be on the safe side by practicing delayed gratification.
If you still want the item after three days, then buy it. By following this rule, you can prevent impulsive spending and train your mind not to act on urges.
Cut Back on Nonessentials
Take a piece of paper and jot down all the inessentials you buy regularly. Then, cross out any item that you can live without.
Go through your bank statements and find recurring nonessentials from previous months. You might think that cutting back on that favorite $5 latte from your local cafe seems like a minor change.
But if you can save $5 per day and make homemade coffee, you can have at least $1,825 by the end of the year. So, never underestimate the little changes you can make in your spending.
Save for Big-Ticket Item Purchases
One of the cons of getting paid weekly is that your pay isn’t as big as getting a monthly salary.
So, you need to save a small portion of your weekly pay for bigger expenses like a down payment for a car purchase, a rental deposit to relocate to other places or the latest gadgets.
Set a goal to save 10 to 20% of your weekly salary in a separate account. Don’t touch this money until you achieve your savings goal.
Create Spending Envelopes
It is much easier to overspend and go over your budget when you use debit and credit cards or online payments. Although these two payment methods have their own benefits, you can quickly lose track of your spending, especially when you forget to check your card’s balance.
Then, place cash in separate envelopes. This way, you can allocate funds for necessary expenses and use the remaining balance in your bank account for non-essential purchases.
Build Your Emergency Fund
So, it is extremely important that you pool a sizable sum of money for your emergency fund. As a start, you can save $1,000 and keep it in a separate account.
Don’t touch this money unless you really need it. Then, slowly build up these savings until you have at least three months of your monthly expenses.
You can always take a baby step when planning your weekly budget. Don’t compare your plan with others because different households have different incomes and expenses.
Over time, when you’re aware of your own spending habits, you can tweak your budget and set a bigger financial plan for your future.