When it comes to building a budget, almost everyone believes it’s a monthly activity. When you get paid at the end of the month, you set up a working budget to plan for your income. While this is valid, you can also create a weekly budget. Even though it’s not common, weekly budgets have a few amazing benefits that you don’t get from budgeting your money on a monthly basis.
Most importantly, since you probably haven’t done this before, I will be showing you how to budget weekly with a simple 10-step process in this post.
Mind you, this weekly budgeting strategy is almost the same as the monthly plan you’re used to. Hence, this should be somewhat easy for you to carry out if you are used to budgeting your salary already.
Is It Better To Budget Weekly Or Monthly?
Budgeting weekly or monthly should be based on how you earn. If your paycheck comes once a month, you can stick to a monthly budget. But if you are being paid once in two weeks or even a week, then you should get used to building a weekly budget.
How To Create A Weekly Budget In 10 Simple Steps
Figuring out how to budget weekly for the first time may seem like a lot of work. However, it becomes easier when you get used to it. Here are 10 important steps to creating a weekly budget:
1. Study Your Cash Flow
Do you know how much you earn and how much you spend weekly? This is literally the first step you pay attention to if you want to learn how to budget weekly. Understanding your cash flow means knowing how much money comes in and how much is being spent on expenditure over a period of time. When you have this information, it is easier to determine how much should be put toward a budget.
For example, if your total expenses for the week amount to $850 and your weekly paycheck is $1,500, you can clearly see that you are living within your means. So when building a weekly budget, common sense suggests that your total expenditure shouldn’t be more than $900 at most.
2. Track Your Spending
It is important that you are aware of your spending habits. Have a little notebook where you keep track of your purchases as they occur. You can also download a free fancy app on your smartphone that allows you to write things down.
Taking notes while spending your money is a brilliant exercise that helps you to be more conscious of your spending. It’s the perfect way to avoid impulse buying. It may be difficult to maintain this habit, but with time, you will realize it’s not a serious challenge.
3. Categorize Your Spending
By following step two strictly, you can see all your spending. This makes it very easy to categorize your expenses. From food to utilities, have all your expenses in different categories, and then rank them in a particular order.
For example, you can have a category called “survival” which will include things like food, water, rent, transportation, and school fees. You can have another category called “improvement” which should contain things like gym, healthy hobbies, gardening service, etc.
Creating these different categories is a great way to pinpoint where your money goes. It doesn’t get any simpler than this.
4. Itemize Your Goals
One of the major steps on how to budget on a weekly paycheck is to list your goals. Aside from the basic expenses you need to cover every week, you would agree that there are certain personal goals you have in mind. You have aspirations, dreams, and vivid imaginations of how you want your life to be in the near future.
This is why you have to identify your goals so you can build a budget that allows some of your finances to be invested toward those long-term or short-term goals.
5. Know Where To Cut Back
One of the main goals of building a budget is to spend moderately. At some point, you may need to cut down on your expenses if your total income can’t cover your expenditures and help pursue your financial goals.
Examine the categories you created earlier. Look for areas you think you could spend less, especially when it comes to recreation. You just have to be more concerned with your essentials. That way, you could free up some cash in your budget for other important goals such as savings.
Mind you, if you need better insight into how to reduce your living costs and make the most of your income, check out these 25 frugal living tips that will help you save a ton of money.
6. Create Your Budget
Now this is the most important step. You can use a spreadsheet to create your budget or download a tool on your mobile device.
There are several free and paid budgeting apps for managing money you can find on the Play Store or App Store. These apps can help you list your expenses in different categories and set reminders for certain payments.
Moreover, don’t forget the most important rule in budgeting; your total expenditure should never be more than your total income.
7. Set Money Aside For Savings
If you really want to learn how to budget when you get paid weekly, make your savings goals a priority. Keeping some cash in a savings account every week or month is how to achieve most of your financial goals.
While planning for your bills, don’t fail to plan for savings as well. This is why you must not live above your means. When your total expenditure is more than your total income, it becomes impossible to save. Instead of saving, you would keep piling up debt.
8. Cut Yourself Some Slack
Trying to learn how to budget weekly income for the first time won’t be easy. This is why you have to take it easy on yourself.
For example, when it comes to savings, you can automate the transfer to your savings account. So when it gets to that time of the week or month, the transfer is carried out without you lifting a finger. Your weekly budget will become more realistic when you try to make things easier for yourself.
9. Stick To Your Budget
This might actually be the most difficult aspect of learning how to budget when you’re paid weekly.
You must have heard a lot of people say “Consistency is key”. They are absolutely correct. Building a budget is one thing, sticking to your budget is a different ball game. Avoiding things like impulse buying, late payments, and irrelevant purchases are major steps to sticking to your budget.
Nevertheless, even if you couldn’t spend according to your budget the first time, try again the following week. You don’t have to give up just because you couldn’t pull it off initially.
By the way, if you need helpful tips sticking to a budget, check out these 13 helpful tips on how to stick to a budget.
Reviewing your budget at the end of each week is another strategy to help you stay on top of your game. Check your spending notebook or journal, bank statement, and receipts. This is something you have to do over and over again. That’s how you get better at managing your money with a weekly budget.
Benefits Of A Weekly Paycheck Budget
Knowing how to make a weekly budget has its perks. Here are some reasons why you may want to stick with this style of budget:
Creating A Weekly Budget Makes It Easier To Avoid Overspending
A study at the Duke University’s Center for Advanced Highlight revealed that families paid weekly are likely to spend less, unlike households receiving monthly earnings.
When your budget only covers a week’s expenses, it’s obvious how limited your spending habit is. You are literally planning for just 7 days or less, unlike other folks who have a 30-day circle to spend their income.
This is one good reason why I would advise you to learn how to do a weekly budget if you are not a monthly salary earner.
Creating A Weekly Budget Stops You From Overthinking
Monthly expenditure is certainly much larger than the expense you plan for in just a week. This alone suggests that if you know how to set up a weekly budget, your mind won’t be bugged by too many expenses. It’s more like achieving a massive goal bit by bit.
Here’s the thing; Remember that you are actually spending money throughout the month. However, you have broken the goal into weekly milestones. This means you wouldn’t have much to think about since you are focusing on one week at a time.
Creating A Weekly Budget Allows You To Pay Off Debt Easily
Saving and paying off debt can be easier when you understand how to budget weekly. This is because if debt payments are among your top priorities, you would want to make these payments weekly as you build your budget.
When these frequent transfers are part of your weekly budget plan, you will clear your balance in time, especially if you are paying down high-rate credit card debt.
Quick Tips To Make Weekly Budgeting Easier
Sticking with this budget method may be difficult if you are just starting, so here are some weekly budgeting tips:
1. Be Realistic
Before you can achieve any goal, you must make sure that your expectations are realistic. This same principle applies to the weekly budget. Don’t try to do too much. Don’t try to compare your financial situation with someone else’s. Set a realistic budget that is tailored to your cash flow.
Whenever I’m building a budget, I don’t try to act like I’m superhuman. I acknowledge my weaknesses and find a way to navigate through them.
For example, if I know I can’t do without a can of soda every day, instead of cutting it out from my budget entirely, I simply limit the number of sodas I purchase. That’s what it means to be realistic.
2. Focus On What’s Important
If you can’t focus on your essentials, don’t bother learning how to budget weekly. It would be pointless. Your budget should only help you focus on the expenses that matter. If you choose to incur irrelevant costs at the expense of your budget, it means you don’t care about financial improvement.
To stick to your weekly budget, don’t spend on anything that’s outside your financial plan except during an emergency.
3. Have A List Of Short-Term Goals
Setting relevant short-term goals is a great way to build self-motivation when you’ve learned how to budget weekly.
Ideally, your budget is supposed to make room for your personal financial goals. Your savings category, for example, is a good avenue for working toward your goals. Ultimately, this compels you to take your weekly budgets seriously. You don’t need anyone to remind you that if you keep breaking your budget, your goals will be unattainable.
4. Have An Accountability Partner
As you figure out how to budget weekly, it’s important to have someone by your side to join you in tracking your progress and making sure you don’t do anything that will jeopardize the success of your goal.
If you’re married, then your situation is perfect. Your spouse should be your accountability partner. After all, the budget is for the betterment of your household. It would make sense that your partner supports you for the sake of the family’s finances.
5. Use A Payment Tracking App
I briefly talked about budgeting apps earlier. Some of these apps have a special feature that allows you to track your online payments. Every transaction that takes place in your bank account can be observed and reported on by a mobile app. This is one of the top tips to create a weekly budget without overthinking.
If your spouse becomes your accountability partner, you can use a budgeting app for couples. It will allow both parties to monitor their budget anytime and anywhere.
Final Thoughts On How To Create A Weekly Budget
I’ve had conversations with people who currently rely on this weekly budget method to manage their income. It works amazingly like the typical monthly budget.
If you think this would be perfect for your finances, don’t hesitate to try and see how it works out. But to make the whole budgeting process easier, make sure you automate certain payments, limit your spending as much as you can, and most importantly, take time to review your budget regularly.
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