How to Make a Budget for a Pay Period
Getting on track financially means taking conscious control of your spending habits. The only way to do this is to create a budget and stick to it. If you stay within the spending confines of your budget, you will find it easier to pay your bills, reduce your credit card debt and begin to feel stable with your finances. Creating a budget by pay period helps to understand cash flow and to better plan for the expenses that come up.
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Instructions
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Organize copies of paychecks for the budget pay period. Companies pay weekly, biweekly, semimonthly or monthly. If you don't have the paychecks for the period, review your bank statement for this information.
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List the amounts of income for the pay period in question and total them together on a piece of paper. This is the total income for the period.
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Collect all the bills that you owe and make a list of these on a piece of paper in the order that the bills are due for the pay period. Add in budgeted amounts for food, clothing, transportation, entertainment and medical amounts on separate lines. To find out what these are, review your bank statement and subtotal the amounts spent for these items within the pay period and add them to your list.
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Add any allocations to savings programs to these amounts as separate line items. Add all the expense items together.
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Subtract the totaled expenses from the total income to calculate the disposable income. The money left over is free money to put to use for bringing down credit card debt or saving for something special.
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Keep track of all these items by inputting them into a spreadsheet program on your computer. Use the spreadsheet as a means to keep track of spending to ensure it is in line with your budget. Many financial websites offer free budgeting and debt reduction spreadsheets for use in managing your personal finances.
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Tips & Warnings
Be realistic when it comes to allocations for your living expenses, such as food and other items. The first step to gaining control of your finances is to review what you are spending on a month-to-month basis and to look for areas where you can cut back. Once you get a handle on your spending by using a budget, create a special "splurge" account to allocate funds for something special. This helps to ease the budgeting process and rewards you at the same time for sticking to your budget.
Live within your means to avoid spending more than you earn. While it may feel nice to use credit cards, you have to pay the money back. Cut unnecessary spending, such as entertainment or clothing allowances until your budget is back on track. Avoid credit card purchases unless you can pay the balance off each month.
