Paid weekly budgetting

olb81

Hi I am starting to draw up a budget, main problem I get weekly pay. So 8 months a year paid 4 times and 4 months a year paid 5 times.
I was thinking of budgeting based on 4 weeks pay, and seeing the occasional 5th week pay as a bonus?
Any thoughts?

Exodi

Budgets are always based on averages.

For example, we pay our car insurance annually - I could either leave it off the budget and get blind-sided on a future month by a several hundred pound bill I hadn't accounted for, or I include a monthly average for it and eventually pay it from the surplus that has built for it in savings. So if my car insurance bill was £240, I might allocate £20 a month into my budget for it.

Same with birthday presents, or Christmas or holidays, we want to ensure we save some money towards these every month, as opposed to wishing our future self the best of luck in December or relying on credit.

I would apply the same concept with your pay, I would put your income as [Weekly Pay] x 52 / 12. Some months you'll have less income than expected, some months you might have more, however (you'd hope) in the months you were paid more, you'd put the surplus to the side to weather the months you're paid less.

Alternatively, you could just update your budget month to month with your actual pay.

Rob5342

One option is to get paid into a separate account, and have a standing order for your pay amount to your main account on the first of the month. That way you have a monthly payment you can budget with, and once a year you get an extra months pay you can save, use for your car insurance etc. 

sheramber

olb81 said:

Hi I am starting to draw up a budget, main problem I get weekly pay. So 8 months a year paid 4 times and 4 months a year paid 5 times.
I was thinking of budgeting based on 4 weeks pay, and seeing the occasional 5th week pay as a bonus?
Any thoughts?

When we were paid that way I budgeted on 4 weeks pay and put the 5 th week into savings  when it arose. 

maman

I think your idea of treating the 5 week months as a sort of bonus is a good one @olb81 but are you starting from scratch?🤔 Do you have any existing savings?

I think it will be relatively easy to stretch the food budget to 5 weeks from 4 but other bills not so much. Some will be fixed and annual like insurances and tv licence, others are more seasonal like gas and electricity so you need to work out monthly payments for those and if they could be done on the basis of putting aside 12 payments a year then you'd have 'bonus'  money from those too. Like many people, I pay my council tax over 10 months so there's 2 'bonus' months that can be saved.

IMO, building up an emergency fund has to be a priority.

olb81

Yes for the next 65 weeks I am paying family debts of 100 per week  and no current emergency fund just an overdraft of 1300

Exodi

olb81 said:

Yes for the next 65 weeks I am paying family debts of 100 per week  and no current emergency fund just an overdraft of 1300

In which case I'd suggest heading over to the DFW (Debt-Free Wannabe) board:
https://forums.moneysavingexpert.com/categories/debt-free-wannabe
and posting a Statement of Affairs: https://www.lemonfool.co.uk/financecalculators/soa.php

Aside from the family debt, you need to work out a budget that allows you to have money left over at the end of each month. I'd imagine at present Christmas/annual bills/etc probably go on overdraft/credit.

You haven't mentioned any other debts, but even if you had no debts (and no savings), I'd still recommend going over there for a spending makeover.

The money that can be saved from looking into broadband, phones, energy tariffs, etc can be massive.

With no savings, it only takes one emergency for things to spiral out of control (I say this as someone that was trapped in the payday loan cycle for at least a year around a decade ago - taking out loans to pay off the old loans).