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Would it be weird to say that I actually enjoy budgeting? I know I’m probably in the minority, but I can honestly say that it is fun for me to sit down in front of a spreadsheet and calendar and plan out where our money will be going.  I am a huge fan of zero-based budgeting, and it has helped us successfully pay off almost $70,000 of debt in 3 years while still contributing to retirement accounts and building an emergency savings along the way.

Live debt free and save money using the budget by paycheck method. Create a livable budget using free budget printables that help track finances paycheck to paycheck. #budget #paychecktopaycheck #budgetbypaycheck #familybudget #debtfree

There are so many different budgeting systems out there that it’s important to find one that is easy to implement and aligns with your financial situation.

What is the Paycheck Budgeting Method

When I say that I believe in a zero-based budgeting method, it means that I budget paycheck to paycheck instead of looking at a month in it’s entirety.  When my husband and I first started tackling goal setting around debt, we created an Excel spreadsheet that outlined how our month should look based on income coming in and expenses going out. We quickly learned that a spreadsheet is not a budget. We knew we should have $200 left over at the end of the month but somehow we ended up in the red. A budget is an active document that you are tracking regularly since we all know that life happens and we don’t necessarily spend our money in the way that we intended.

Related: Budget Basics: How to Create a Family Budget 

In a paycheck to paycheck method, you are able to adjust and make necessary changes to your budget when the unexpected happens or you overspend in a category of your budget.

If you’ve ever been really proud of how well your month is going financially and all of a sudden you find out someone has a cavity, your car needs new brakes, your utility bill was higher than expected, or some other curve ball, this method will work for you! Don’t panic, just make adjustments.

Who Would Benefit

The paycheck budgeting method is ideal for those who receive bi-monthly, predictable paychecks.  This can be two assigned days of the month (ex. 5th and 25th of each month) or every other week (ex. every other Friday).

You can benefit from this method if you:

  • Are living on tight margins and your income and expenses are equal
  • Find yourself ‘in the red’ each month but you’re not quite sure how it’s happening
  • Have debt and want to allocate monthly income towards debt payments
  • Want to build an emergency fund of $1000+
  • Are at the point where you are working towards larger savings goals (ie. paying off your house, maxing out your 401K, saving towards college funds, etc.)

I have successfully used this method in varying stages of my life from being single living on $24,000 per year, to married paying off substantial debt, and now working towards some big goals that can sometimes feel unattainable without a targeted plan.

When I first started this method, I would put sticky notes on my computer that had the date range the paycheck covered and all of the bills that fell within that range.  I would add up the expenses, subtract that from income and would have our leftover amount for variable expenses. My super organized husband would look at my set up and have no clue what I was doing.

These days I use my Ultimate Budget Binder, and my husband can easily jump into the budgeting conversation.

How to Start Putting it Together

Here’s where the fun starts (let’s get excited about budgets!). The first thing you’ll want to do is pull out a monthly calendar. My Home Printable Pack has a monthly calendar you can use to get started.

Related: How to Create a Monthly Budget Calendar

  1. Write down the days that you will be receiving paychecks for the month. If you and your spouse receive paychecks on different days or staggered weeks, you can budget weekly or lump your paychecks together within a 2 week window. I personally recommend lumping your paychecks together within a 2 week window and acting as if you’re paid bi-monthly.  It just simplifies the process.
  2. Write down the name of each bill and amount due on the due date. This only includes fixed expenses like utilities, car payments, and school loans.
  3. Take your income for that pay period and subtract your expenses to find your ‘leftover’ money. This leftover money will be used to go towards your variable expenses, debt repayments, savings, gas, and miscellaneous fun.

This is a great way to plan for annual and semi-annual bills you may have. For example, you may have an annual HOA fee or membership fee. Take the amount of that bill and divide it by the number of pay periods until it is due. You can then save a little bit each pay period towards these bills so it doesn’t feel like it hits you all at once. You’ll have it set aside and ready to go when it comes time to pay these larger annual or semi-annual bills.

Note: If you are paid every other week, you will find that there are two months out of every year that you receive three paychecks. I wrote a blog post about what I recommend doing with that third paycheck HERE.

Over the years I have found it empowering to have my paychecks and bills in front of me with a plan in place. I know that many of us feel like money and bills are such stressful topics. Maybe you stick bills or past due notices in a drawer out of sight. You don’t log in to your student loan accounts so you don’t have to see the balance. Or maybe you use a credit card to fund that family vacation you really can’t afford.

Taking an honest look at your true budget and creating a plan to address those problem areas puts you in control. Tiny steps in the right direction help create the lifestyle you want for yourself. So print out that calendar, take an honest look at the numbers, and start planning!

What are some of your biggest stressors when it comes to budgeting and personal finances? Has your budgeting method been working for you so far?

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Sarah Nichols

Sarah Nichols, founder and content creator for Let's Talk Mom Business, has a background in business, marketing, research, and advocacy. combines her Masters in Business Administration (MBA) and experience as a Marketing Expert for B2B tech companies to help moms start and scale an online business or shake up their career after a career gap.

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