Stretching January Costs

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January is the year's only five week month
How to stretch out your finances...

Dec's early payslip seems great pre-Christmas, yet it means the cash needs to stretch an extra week. As that coincides with Christmas & Jan sales it's no surprise many struggle. Here are some quick tips...

Know what you've got left. Check ASAP what cash you've left for the month, when your next pay cheque's due, and whether any bills are due. Then calculate what you've left to spend per week and stick to it. It ain't rocket science, but it takes discipline.

Use Feb's money early for free. Feb's the shortest month, so if you must, access its cash now. The easiest way is to spend a little on an empty credit card then repay it IN FULL next month to avoid interest. Otherwise, use a new card with a 0% deal on spending though the time it'll take to arrive may scupper things.

£1,500 interest free budgeting & crisis loans. Those with severe problems may be eligible for special job centre funds. Crisis loans are for emergencies, eg repairs after burgulary; while Budgeting loans are only for benefits recipients, but allow spending on a wide range of things. Each job centre has its own cash, and sadly many run out quickly, see the debt help guide for more info.

Preventing future problems requires good money management. So tackle it now, do a decent budget, ensure you're getting all due benefits (see 5 min benefit check-up), and most importantly ensure you're getting the best deal on everything...
Money Makeover Special...
As every January millions start dieting, exercising and sorting their finances, this week's e-mail is a money makeover special looking at the big ways to save...

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Comments

  • paulmcerlean
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    Thankfully I got paid on new years eve and can just about manage!
  • Paul_Herring
    Paul_Herring Posts: 7,481 Forumite
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    January is the year's only five week month
    Not for those of us who get paid monthly it isn't. There are usually 4 '5-week months' in the year. (4*5 weeks + 8*4 weeks = 52 weeks.)
    Conjugating the verb 'to be":
    -o I am humble -o You are attention seeking -o She is Nadine Dorries
  • MORPH3US
    MORPH3US Posts: 4,906 Forumite
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    Only tip I can give, and not great to help now.... but....

    Start saving for next Christmas NOW!!! Obviously pay off this Christmas first but if you can spare even a £10 a month now then put it away ready...
  • chog24
    chog24 Posts: 96 Forumite
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    My company was recently 'bought out' and I was a bit worried when I found out that the new owners didn't do the traditional thing of paying people a week or two early in December. However, it's worked out well! Because I knew I wouldn't get paid till New Years Eve, I budgeted well and spent cautiously in December (granted, though, I don't have many people to buy gifts for and this would've been far more tricky if, for example, I had kids). The upshot is that one week into the five-week January I've got enough money to last the month and don't anticipate any problems.

    There was one company I worked for, however, who had the PERFECT solution, in my opinion. They paid people two weeks early in December and one week early in January. This meant that December was a 3 week month, so that both November's and December's salary payments could be used towards Christmas but then both January and February were, in effect, 5 week months and it made budgeting a whole lot easier. I honestly don't know why more companies don't do this - it seems like perfect logic to me!
  • edda
    edda Posts: 1,057 Forumite
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    Not for those of us who get paid monthly it isn't. There are usually 4 '5-week months' in the year. (4*5 weeks + 8*4 weeks = 52 weeks.)

    I'm with you on this one Paul. AFAIK there are more than 49 weeks in a year (1x5 +11x4). ;)
  • Nosrrud
    Nosrrud Posts: 38 Forumite
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    edited 6 January 2010 at 1:11PM
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    I use a pocket money account system:
    1. Bank Account = Salary is paid into and all bills, standing orders and direct debits are taken automatically from this account
    2. Pre-Pay Credit Card (o2 Cash Manager) = Used for spending throughout the year i.e. I allocate £240 per year to pay for car tax and my MOT, I transfer £20 each month and when annual things like this crop up, the money is there waiting to be used. (I should really increase this to £30 to give me £120 to spend at Xmas 2010)
    3. Pocket Money Bank Account = Whatever is left in the main bank account (on a calender month basis) is divided by 5 and this figure is transfered every Friday to my second "pocket money" bank account. This gives me a weekly amount for groceries, petrol etc..
    The reason I divide what's left by 5 is to account for 5 week months, as there are only 4 '5 week months' I will automatically save 8 weeks of my allowance without thinking about it, and this will be for emergency things.

    It took me November and December to switch from spending on Payday then running dry for a month to running this system but now it's in place (early days yet, only 3 weeks in to it) I'm secure in the knowledge that all bills will be paid, I keep getting money every week, annual things are covered for and I'm saving for emergencies - I should have done this years ago!
    Using MSE Feb 09, Forums since Dec 09
  • townie
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    chog24 wrote: »
    My company was recently 'bought out' and I was a bit worried when I found out that the new owners didn't do the traditional thing of paying people a week or two early in December. However, it's worked out well! Because I knew I wouldn't get paid till New Years Eve, I budgeted well and spent cautiously in December (granted, though, I don't have many people to buy gifts for and this would've been far more tricky if, for example, I had kids). The upshot is that one week into the five-week January I've got enough money to last the month and don't anticipate any problems.

    There was one company I worked for, however, who had the PERFECT solution, in my opinion. They paid people two weeks early in December and one week early in January. This meant that December was a 3 week month, so that both November's and December's salary payments could be used towards Christmas but then both January and February were, in effect, 5 week months and it made budgeting a whole lot easier. I honestly don't know why more companies don't do this - it seems like perfect logic to me!
    That's fine if the company can afford to pay early, but many smaller companies need their own monthly income in order to pay salaries at the end of the month, and paying two weeks or even a week early can cause havoc with the cash flow.
  • daveyjp
    daveyjp Posts: 12,588 Forumite
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    The benefit of 4 week pay - no 5 weekend months. Pay day next week for many on this system.
  • phildo_2
    phildo_2 Posts: 43 Forumite
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    edda wrote: »
    I'm with you on this one Paul. AFAIK there are more than 49 weeks in a year (1x5 +11x4). ;)

    and surely, if the OP is suggesting that January is a 5 week month because of being paid early, then by the same rules December must only be a 3 week month and you can use the extra money you 'saved' ???????

    Or, alternatively, you have been paid 2 months pay during the 2 month period. The early payment is just a timing difference, unless (as I suspect the original poster has done) you treat the money received in late December as a 'nice bonus' and spend it :confused:
  • tiff
    tiff Posts: 6,608 Forumite
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    Getting back to the original post. I'm not so sure its a good idea to borrow from February's money on a credit card. It would be better to learn to budget and make do with what you have if at all possible.
    “A budget is telling your money where to go instead of wondering where it went.” - Dave Ramsey
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