Do you receive a paycheck only once a month? If you do, then you certainly know how difficult it can be to stay within your budget. The last weeks in the month are particularly hard as they seem to drag on forever. Receiving a monthly paycheck can be both of lifesaver and a curse at the same time. For those of us who love to spend, we find ourselves spending all of our money once the bills have been paid. And then we hit the middle of the month only to realize we need extra money for groceries or odds and ends.
I used to be paid only once a month and I wasn't a fan. Granted, I would derive great satisfaction from paying all of my bills at the beginning of the month. But once that was done I would run wild and spend the rest of my money. I'm glad to say that my shopping habits and budgeting process are very different now!
Here are a few tips for budgeting when you are paid once a month.
Clearly Define Your Budget
It takes a lot of self control to be able to stretch your paycheck to last the entire month. Once the stress of the bills are off of your shoulders (most likely in the very beginning of the month) it can be easy to look at the cash leftover as "fun" money. We all know how easy it can be to burn through this extra cash like wildfire.
Have a clearly defined spending plan and use a budgeting method like the 50/20/30 Method or the Zero-Sum Method. Also, some of my readers suggest that it's easier to follow their set limits by using only cash once the bills are paid.
Pay ALL of Your Bills as Early as Possible
Since you're only being paid once a month, I will assume that your one paycheck has to cover all of your bills for that month. Do yourself a favor and avoid running out of cash by paying all of the bills as soon as the money is in the bank.
I know some people may feel more comfortable letting that money sit in their account until the bill is actually due. But if you find yourself lacking in funds when your car payment needs to be paid on the 15th, leaving the cash in the account until then isn't a luxury that can be afforded.
Create Category Limits Per Week
Getting paid once a month is a fantastic way to work on financial discipline!
Setting a weekly limit for flexible expenses such as groceries or date nights is one of the easiest ways to make sure your cash lasts the rest of the month. When I was in college (and only being paid on the 1st of each month), I would pull out fours weeks worth of grocery money and separate it into envelopes. It's an old-fashioned technique but it certainly works if you don't want to keep track in your online banking.
Change Your Due Dates
Adjust all of your due dates for larger bills (such as a mortgage, car payments, student loans, etc.) to the beginning of the month. This forces you to pay the bills first and foremost. However, be aware of the temptation to go on a spending spree with the money that is leftover. While there is security in paying all of your bills in the first week of the month, there's a chance that you may not have any in the middle or the end of the month if you're not careful.
Budgeting isn't always easy and when you are only paid once a month it can be even harder to manage. These tips may not work for everyone but they could help ease the stress of running out of money.
How do you handle being paid once a month?