Happy payday (someone’s getting paid today)! Whether you’re paid bi-weekly, semi-monthly, monthly, quarterly, annually, etc. there is a routine that you should adopt in order to keep your finances organized. Each week of payday, I follow a routine that keeps me up to date with my bills and on track with my budget. Hopefully, my routine will motivate you to make some adjustments to your financial routine for the better.
Create and Revise Budget
I always take the time to write out my budget before payday. If you are not salaried, a great way to track your hourly pay is through Paycheck City. I love using their tool because the expected taxed income is always accurate. With that, I list all of my bills and budget areas that I plan to cover that check. Most importantly, I compare my budget categories to plans I have coming up in that pay period. This way, I am prepared to cover any expenses associated with them well in advance. After the initial budget draft, I am always revising it until payday.
Check Bank Account
The morning of each payday, I check my account. I know this seems very thirsty, but there’s a method to my madness. I’ve had a few occasions where payroll was not setup properly for my direct deposit. Consequently, my paycheck was not deposited into my account. Also, with paydays being on Friday, I could not expect any money into my account until Monday morning. You can believe I paid a visit to my job for an asap manual check, whether I was off or not.
So, the first step is to verify that the money is there! I also check my paycheck stub to make sure the numbers match. Especially in my job where I earned commissions, I wanted to see where extra funds came from. Once these things are verified, I take a final glance at my budget and adjust accordingly. One great financial tip that I try to stick to is making sure all my funds are accounted for. Allocating all of your funds discourages any deviation from the budget in fear of overdraft.
Manually Post Payments
After verifying my funds and solidifying my budget, it’s time to pay off these bills! Despite the conveniences, I opt out of automatic payments for a few reasons.
- There are fluctuations in my monthly bills.
- Varying pay dates each month are too inconsistent to safely automate.
- I want to closely track money in and out of my account.
Manually posting bills gives me complete control over the bill pay process. I still receive paperless bills and complete the same steps online. However, I avoid all automation. The only automatic bills I have are small subscriptions and I keep them on my credit card. I keep these separate because the bill amount is consistent each month and I know what to expect.
Set Aside Savings
Savings is such a crucial part of financial health, not to mention all the things it provides for long-term planning and security. I try to save around 10% of my income per check, but the key is saving something. There are times I’ll cut back but still put money away. I made a point to make this its own step because I am learning the true benefits of saving. Being able to take trips, buy a car, and move between states within a few short months were all possible due to my saving habits (and good timing). I place my savings into a separate account and make sure to track this before allocating any spending money to myself.
Set Aside Spending
Lastly, I set aside my spending money. As I said earlier, all money is accounted for in the budget. So at this point, I should balance out to $0 in my account (not including the carry over personal money that I did not spend from last month). I track my frivolous spending weekly to ensure I am within budget. Sometimes, I adjust my budget further to make sense of the money I have left (including that extra from the last paycheck). The goal is to stay within budget.
Since most of my bills are paid on Friday, none of the payments show up in my checking account until Monday or Tuesday of the next week. Again, in an attempt to prevent fraudulent activity and to track my own activity, I check my account once on Monday and Tuesday mornings for the automatic withdraws. These payments were made manually, but on the bank’s end, they are still considered automatic.
Another reason to double check deposits and withdraws are to double check your own errors. I have had instances in which I set the wrong payment date. This threw off my budget and more specifically, my spending money. Sometimes checking for that human error will save a headache in the future.
Check the Budget Again
With all necessities covered, I am able to look ahead. I tend to forget there is a whole two-week time span between pay periods and I be living this lavish life over the weekend after payday. Then I remember I have gas, food and events/activities the next week that I need to hold money onto for. So at the beginning of the next week, I will estimate how much spending money to allocate for the following week. By further itemizing my money, there is less likeliness that I will overspend in one week and fall into the vicious “living paycheck to paycheck” cycle.
Going into the second week, I begin to plan my next budget and we start all over! I have found these small details to be helpful and really keep me on track with my budget, keeping up with bills and maintaining a decent balance in my account at all times. Other things I do to stay organized are keeping folders in my email for all statements and payment confirmations, periodic debt tracker worksheets to get a snapshot of my bills, use the Qapital to boost my savings and use the Mint budget app to monitor my credit score.
Let me know if any of these tips help you out. I sure hope so!