How to Make a Budget by Paycheck?
Have you ever had that uneasy feeling of counting down the days to payday because you have more months left than you actually have money? It’s definitely not a good feeling to be uncomfortable with your money and feel as if you are just a slave to that paycheck. So, one of the ways that you can break that cycle of living paycheck to paycheck is to get one month ahead of your bills.
How Much Are You Spending Every Single Month?
If you are going through everyday life and are just swiping your card, with no idea how much money you spend, that’s seriously problematic. The best way to combat this problem is to operate from a monthly budget. Of course, some things will fluctuate from month to month, but it’s a good idea just to have an average of how much you are spending each month.
Set Up Your Monthly Budget
To figure out all the above-mentioned information, create a monthly budget, and list all of your regular recurring expenses. After you know how much you are spending on a monthly basis, the next thing is to have a starter emergency fund. It’s highly recommended at least heaving a little baby emergency fund in place before you decide to work towards getting one month ahead of your cash flow.
An Essential Piece of Advice
Life is full of unpleasant surprises; thus, it’s good to have an emergency fund set aside. Of course, you can add to it later, but we recommend having at least a thousand dollars in reserve for your starter emergency fund.
Start Saving More Money
The next step is to start saving money so that you can accumulate that one month of expenses in a savings account. Utilize money from bonuses, income tax refunds and put them aside into this account with the hopes of being able to get one month ahead in your cash flow. Any windfall of money that comes in, you need to put aside into your savings account to know specifically that this money is for the next month’s worth of expenses.
The Final Thoughts
Once you have reached the point where you actually have that one month’s worth of expenses set aside, you can officially get one month’s head in your cash flow. You may have full access to your next month’s budget a month before. You do not have to wait for your paycheck to roll around or apply for a loan. All you need to do after this is repeat the process as once you break the cycle, there is a sense of relief and heaving peace of mind that you are no longer bound to struggle between paychecks.
