Budget your Paychecks in these easy steps!

If you have never budgeted or you are an experienced budgeter, this is the post for you! I have gone back and forth over the years with different types of budgets and lately, I’ve landed on the zero-based budget.

This one has worked a lot for us in the past but I think the reason it is finally working for us now is that we are making less now because my husband is working on remodeling our house and of course, he doesn’t get paid for that! It would be great if he did, but alas, that is not how it works. So right now, we are living off one income, which is mine, and although it is stretched thin, we still have room to play a little bit each month.

I work at a bank and I am paid a salary, so my paychecks don’t change except for maybe by a penny here and there. I’m lucky that way, but even if your paycheck changes, you could still budget most of your bills for the month based on how much on average you normally earn. Since we have been doing this for the past 4 months or so, I’ve been able to get us a half payment ahead on some bills and even a full payment ahead on our mortgage!

Here are the steps I’ve taken for a zero-based budget:

• Budget all expenses for the month (or two weeks, weekly, etc.)

  • Write down the date of the paycheck and what bills need to come out

• Pay yourself

• Transfer funds to the respective places

• Record all the debits/credits!

Budget expenses

This seems easy but inevitably, you will forget something!

Don't do what I did..

Our trash bill comes out quarterly, so I would forget this bill constantly! And, of course I didn’t account for it in the prior two months so it was a large bill ($78) that hit me “out of the blue” (even though it wasn’t!).

I finally started to remember that sneaky little trash bill and what I do now is divide it up into 3 months and record it in my checkbook register!

One thing I never do is rely soley on my online banking. The reason is I know I have outstanding checks or automatic payments like our trash bill that I have recorded in the checkbook but it won't show up on my online banking yet.

This is why I always recommend getting yourself something to record your expenses in, whether it is a checkbook register (even if you don't use checks!), Google Sheets, Excel, or just a pretty little Hogwarts notebook like I use. 😀

So, this is how I budget out my paychecks. The list looks something like this:

• Mortgage: 855

• Daycare: 350

• Tithe: 250

• Life insurance: 186

• Groceries: 350

• Fuel: 150

• Trash: 26

• Fun: 100 (my husband and I split this)

The payments listed above are all half payments except our life insurance. Some bills I have set up to pay in full whereas others are half payments.

My daycare requires payment every two weeks so this works out well for me anyway, and I just pay her when I get paid. Our grocery bill has gone up a lot because of the world we live in right now but this also includes household inventory like toiletries and such.

Some months we go a little over, other months we’re a little under, so on average for a family of 5, we spend $700 a month. I’ve tried to get this lower but again, we all know what the prices look like right now.

Here are some of the foods we eat to make sure we stay on budget.

Pay yourself

What I mean by that is to put some money into savings!

You should always pay yourself first because if you wait until the end of the month, you most likely won't have any left over.

Right now we don’t have a whole lot going to savings, but we still save what we can. It’s usually about $50-$75 a month.

We also tithe 10% to our church though and I think of this as savings as well.

Even though our fun money is for us to spend on what we want, if we have any left over, we determine if we want to put some toward savings or just keep it!

We use our fun money for whatever we want — me it is usually coffee and my husband is usually Body Armor (LOL). We don’t always spend 50-100 a month on those things but we use it if we want to stop for a bite to eat too or treat the kiddos to some ice cream or something else fun.

Make sure that you list yourself into your budget as well as a "bill". Like I said, make sure it's a high priority because otherwise other things will come up.

Transfer or pay the bills!

After you have allocated what bills you need/want to pay, move on to paying them.

This could be in the form of a transfer, withdrawing cash, writing a check, etc.

Personally, I use a combination of all of these methods!

Most of our bills are automatic payments so I don’t have to worry but others, like daycare and groceries, are made with a transfer and withdrawal.

The only check I write now is for tithing and that is just because they don’t take a debit card and I don’t like leaving that much cash in an envelope LOL.

Lastly, Record all of your debits/credits

I am a HUGE believer in a checkbook or something that you record what you actually have in the bank with what you have on paper.

This has saved my butt more times than I can count! I also know that this is what has helped us get a month ahead with our mortgage (on paper).

So when I “pay” my mortgage, I’m just deducting the half payment in my checkbook for each paycheck. That way on paper it doesn’t look like I have more than I think! Unfortunately, my mortgage company won't let us pay in half payments automatically so this is the way I need to do it for now!

Every single thing I pay/withdraw goes into our checkbook and I keep track of the running total through the checkbook, not my online banking.

Trash (the one I always used to forget!) gets a place in the checkbook now as well once a month that way I have all $78 when it comes out every 3 months!

Below is what my bills look like on paper. I am budgeting myself (almost) to zero! I leave a little extra cushion as you can see (about $30-$40 each time) in the account just in case we accidentally swipe the debit card for something.

I always refer to our checkbook for the actual cash on hand. In all reality, we shouldn’t have “cash on hand” but I do like to leave a buffer in there in case something random pops up.

That’s it, it’s not rocket science, but it is difficult to get going when you don’t know how to budget!

If you haven't already, check out my free budget bundle that I made for you. It comes in three fabulous colors that you can choose from! 🥰