Some times it’s the little things that trip you up. If you ever created a beautiful annual or monthly budget but then failed to follow it – it’s probably because you didn’t have a step-by-step process for how you were going to budgeting your weekly paycheck. These five little steps that take just a few minutes (seriously, less than 10 minutes).
Budgeting your weekly paycheck step 1: Balance your accounts
By now you are familiar with my deep and abiding love for You Need A Budget. One of the many reasons I love this app is it is ridiculously easy to balance your accounts. You have to access it on the web-based version but you simply click on “balance”, and confirm the amounts match. If it doesn’t match it will tell you the exact amount you’re off. Then you can find whatever you’ve missed and/or adjust it to make it make.
Why is this important? Because you REALLY don’t want to accidentally budget money you don’t have. That is a recipe for stress. The reason you are budgeting your weekly paycheck is to avoid stress! So just take 15 seconds and balance that account in your YNAB each week. If you have not jumped on the YNAB train yet – what are you waiting for?? Here’s a link where you can get 34 days free access to check it out. (Full disclosure because I love free stuff, if you sign up I get a free month – win/win my friend!)
Step 2: Tally income
If you have all your money coming in through auto-deposit this is pretty easy. While I think YNAB will save you time and money – you don’t have to use it. I just think it makes my life easier and I like to share about it with others. So really, just make sure you know all the money that has flowed in this week. If you get inflows of money throughout the week just add it up on whatever day you “do” your money. Less is more.
Step 3: Transfer your weekly amount to your spending account
To be honest, you could set this up to happen automatically if your income is super consistent. Since the paychecks around my house vary a bit I like to do this manually. Each month I plot out our income, bills, savings and what is left over is what we get for “spending”. I talk about this system of budgeting more in-depth right here so check it out in case you missed it. So since I already know the weekly amount I just transfer it from our bills account to our spending account. (more about why you should have two checking accounts here – it will help you a ton I promise). Boom. Separating out my spending money has made the biggest difference in my ability to save more money than ever before!
Step 4: Allocate your bill/savings money
You know that I believe that every single dollar you have should have a job. So this is the time where you make sure all your bills due before the next paycheck is covered. I like to do it like this. Beginning of the month I start funding all the things as they are due (by due date). I fund all the bills first. Once all the bills are covered I move on to funding the savings goals. Then I transfer the money to the savings account as needed.
This is where YNAB really shines. You have all your bills in there and you set aside the funds to cover certain bills so that you can see exactly what money is set aside for what. Crucial. You stop missing due dates and stop accidentally spending more than you should.
Step 5: Allocate your spending money (optional but encouraged)
This one is optional but I encourage it. Depending on what you are using your spending fund for, it may be wise to separate out things like gas and groceries from fun money funds. I don’t do much more than that.
Budgeting your weekly paycheck bonus tip!
Here’s a quick bonus tip for you. Do this budgeting for your weekly paycheck the day BEFORE you get paid and before you can spend any money. If you get paid, get excited, get takeout and buy that cool sweater you’ve been eyeing and THEN budget…….. Wha wha! No good, you’ve made it a lot harder on yourself. You can set up all of this the day/evening before and then you are good to go knowing exactly how much you have to spend and that all your bills are paid. And that is peace of mind that money can’t buy.