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How Do I Budget?
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Que enspastic Offline
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Post: #1
How Do I Budget?
Any accountants here?

I get paid every 4 weeks but I pay rent monthly.

I would prefer my salary and rent were synchronised: so either "both every 4 weeks" or "both monthly".

Trying to wrap my head around this. Anyone else have this situation?
(This post was last modified: 09-05-2013 09:13 AM by Que enspastic.)
09-05-2013 09:01 AM
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lskdfjldsf Offline
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Post: #2
RE: How Do I Budget?
I was in the same boat for a while. What does your rent agreement look like? You may have some flexibility if you explain the situation to your land lord. You'll have less luck trying to change your pay cycle.
09-05-2013 09:13 AM
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Que enspastic Offline
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RE: How Do I Budget? (Move to Lifestyle section)
Haven't signed my rental agreement yet. It's per calendar month. Sign contract on Friday, might ask if I can get it changed... but I wonder if he'd be ok with that?

I think it would make a big difference.

Otherwise I'm paying one month's rent with 7.9% less income (28 days vs 30.4 days).

At the end of the year I would be left over with 4 weeks rent free but for the previous 11months+ it would be a real squeeze.
09-05-2013 09:21 AM
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lskdfjldsf Offline
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Post: #4
RE: How Do I Budget? (Move to Lifestyle section)
Something seems odd if you're paid every 4 weeks rather than biweekly or monthly - what line of work are you in?

Your best bet is to explain the situation to your land lord and back it up (e.g. bring paystubs). They don't care when they're paid within a time frame, only that you pay and do it punctually. If you're contributing the same amount, won't be an issue.
09-05-2013 09:27 AM
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Ensam Offline
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Post: #5
RE: How Do I Budget? (Move to Lifestyle section)
I have a similar situation. I used a credit card to buffer my income and expenses until I'd built up enough savings. Most credit cards have a 20 day grace period after the end of the cycle before the charge interest - provided you always pay off your card. Put your day to day expenses on the card and pay them off once a month. Only use this method if your confident in your ability to stay on budget. I'd recommend leaving a 10-20% gap in your budget to cover unexpected things until you've been living in your new place at least a year.
09-05-2013 10:25 AM
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samsamsam Offline
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Post: #6
RE: How Do I Budget? (Move to Lifestyle section)
I am not sure you need an accountant for this. Before I dive in, can you survive each month on just 4 weekly paychecks? Would be a very nice savings tool. (Based on your second post - you mentioned it would be a squeeze but I still suggest it).

What may be helpful is the following process (making this up as I go). Also, it won't be perfect, but if you build a pad of savings then it is a timing difference. And that might be the best way is to save enough to have rent ready whenever it is due. And if you choose to only live on a 4 paycheck a month budget, you set aside 25% of the rent from each check.

Suggested Process
1) Take an actual calendar and line up your paychecks (circle the date with one color) and then the rent with another color.
2) Look at the times each month where you feel you might be tight (i.e. check doesn't correspond with when the rent is due). A couple months before these difficult months just make sure to save a few extra bucks.

I don't think you need a massive spreadsheet to figure what to do. This seems more like a timing and saving (setting aside rent money) thing.

Good luck!

S

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(This post was last modified: 09-05-2013 11:22 AM by samsamsam.)
09-05-2013 11:21 AM
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StudebacherHoch
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Post: #7
RE: How Do I Budget? (Move to Lifestyle section)
I recommend not worrying about synchronizing stuff. Either your pay date or your rent date or both are bound to move sometime in the future, and then your consistency will be screwed again. I recommend going with whatever makes you the most happy and is easiest to follow, which means 1st to 31st, but accept that it's not worth worrying about.

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09-05-2013 11:45 AM
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The Beast1 Offline
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Post: #8
RE: How Do I Budget? (Move to Lifestyle section)
You can pay your rent any time of the month. You don't have to pay at the end or beginning. Just send the check off and it'll count.

Look at your biggest monthly expenses that are required of you to pay monthly:

Rent
Required Utilities
(heating, electricity, water, trash removal, internet)
Car payment(if applicable)
Car insurance/whatever the insurance needs to be on

Now take your monthly income and subtract off the things you ABSOLUTELY need listed above.

Now lets break up our weekly required expenses

Food
Fuel for car (if applicable)

Now lets break up frivolous monthly expenses

Cable TV
Netflix
Pandora
etc etc

This 2nd group should be axed if you run into financial troubles (lose a job).

Now the remaining amount is your disposable income. You need to decide how much of this you want to save. You can blow it all or place some of or all of it into an account. This is up to you.

I would suggest you save more than you spend (obvi). But this decisions is your to make.
(This post was last modified: 09-05-2013 12:03 PM by The Beast1.)
09-05-2013 12:03 PM
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AnonymousBosch
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Post: #9
RE: How Do I Budget?
(09-05-2013 12:03 PM)frenchie Wrote:  Now the remaining amount is your disposable income. You need to decide how much of this you want to save. You can blow it all or place some of or all of it into an account. This is up to you.

Great advice, Frenchie.

I take this further, and run four linked bank accounts. Any money earnt going into the first savings account. I'm usually paid fortnightly, and, the night I get paid, I jump onto my online banking and instantly start shuffling money around.

I have budgeted my expenses down to a weekly level. I've worked out how much it costs per week for what I consider 'necessary' expenses like mortgage, gym and pool membership, bike and car registration, vehicle upkeep, internet, health cover etc. I also have analysed my electricity, gas and phone bills, and so have an average idea of what to expect per time of year.

The money this adds up to on a weekly basis is what it costs to simply tread water in society. Looking back at my first account, I can see what chunk of it is already spent simply by sitting still. So when I get paid, I transfer the necessary chunk, +$30 extra per week into my Bill Account, and don't touch it except for payments.

I also have an 'untouchable' savings account, that I transfer a chunk into each fortnight. That's money for hobbies, goals, travel, pursuits or emergencies.

There's a VISA Credit Card I use now and again, but I never put any second large expense on it until I pay the first one off completely. I always pay as much as I can bear to get the balance back down to zero as quickly as possible.

What is left in the first account after all this is actual spending money. I know exactly what money can be used without getting myself into financial stress. I've found this easily lets you identify frivolous expenses beyond your budget.

It mightn't sound like much, but it really doesn't cost much to be a single man in society. Something as simple as making and taking a lunch and piece of fruit to work each day puts me at least $100 per week ahead of the stupid women in the building spending $10-15 on their lunches and $5 or more on their morning tea and coffee daily.

I've been doing this since I left home at 17, when it was much more complicated to physically access my accounts. I've never once missed a payment or haven't had money when I needed it.
09-05-2013 06:27 PM
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StudebacherHoch
StudebacherHoch Offline
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Post: #10
RE: How Do I Budget?
As a bean counter of 34 years, I applaud you guys! If only I'd had the discipline to budget in my younger years, then my "now-decent" nest-egg would've been "gnarly." Excel is your friend - I use it not only to manage my finances, cash flow, budgeting, etc. - but to manage my life as well (goals, to-do lists, journal entries, etc.)...it's nice to have ALL if your salient data in one format-friendly system.
09-05-2013 06:41 PM
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Que enspastic Offline
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Post: #11
RE: How Do I Budget?
(09-05-2013 06:27 PM)AnonymousBosch Wrote:  It mightn't sound like much, but it really doesn't cost much to be a single man in society.

Depends on what city you live in. Income vs. expenses.

Last city I lived in: earned 47% less, saved 63% more.

New city, London: Expensive as fuck.

No complaining, once I get promoted quality of living will be highest it has ever been in my life to date.
09-05-2013 06:55 PM
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AnonymousBosch
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Post: #12
RE: How Do I Budget?
(09-05-2013 09:01 AM)Que enspastic Wrote:  Any accountants here?

I get paid every 4 weeks but I pay rent monthly.

I would prefer my salary and rent were synchronised: so either "both every 4 weeks" or "both monthly".

Trying to wrap my head around this. Anyone else have this situation?

If possible cut down expenses for 3 months, could help level you out quick..if that is what you are looking for here..

It cost to live in hot spots ;]
03-07-2014 04:05 AM
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