I Budget On 4-week Time Periods, Not Months
August 3, 2009 – 5:59 amI wrote about this a while back, but I think it bears repeating. It may not be best for you to budget by month. My wife and I, for example, budget based on a 4-week period. I get paid every two weeks, and therefore developing a budget for a whole month doesn’t work that well for us because twice a year I will get 3 paychecks in a single month instead of two.
I do understand that since I know which months that will occur I can just up my income when we create our monthly budget. For my wife an I, however, being able to consistently review what we earn and spend every four weeks works better for us.
The only potential issue with doing this is that one period a month we’ll have a “bill skip”. With our cable bill, for example, we only pay it once a month. Therefore we make 12 payments a year, but we have 13 budgetary periods a year. So, one period a year we have a bill skip, where our cable bill will be zero.
I created an excel spreadsheet that I use to track our budget and forecast our expenses each period. This makes creating our budget each period very easy, and it shows me when I can expect my various bill skips.
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One Response to “I Budget On 4-week Time Periods, Not Months”
We’re trying to budget the same way as well. Doing it monthly gets awkward when you’re paid bi-weekly because you occasionally end up with an extra paycheck you need to account for.
By Frugal Urbanite on Aug 5, 2009