Do I save now or do I save it for later?
While budgeting your money can help improve your finances, you can also establish a routine for the day you receive your pay.
A payday routine is a series of steps you should take immediately after receiving payment to ensure that your monthly expenses are covered and you are moving toward your financial goals.
Having a regular plan when you receive your salary allows you to take care of your money in the best way, according to your needs.
With each check, you can decide whether you want to pay bills, reduce debt, save additional funds, or invest your money.
"The idea is to develop the habit of managing your money that eventually becomes your lifestyle," said Brittney Castro, a certified financial planner for the Mint money management app.
And part of that habit, Castro says, includes creating a routine long before payday arrives.
Having a plan in place can help you avoid overspending or wasting.
Next, we tell you how to establish a routine for the day you receive your salary:
Start with a budget
Setting a budget ensures that you can get the most out of your pay by knowing how much money is coming in and how much money is going out.
While creating a budget can be time consuming, it can also set you up for success when it comes to keeping track of your expenses, saving money, and paying for expenses such as bills or the occasional splurge for special events like holidays or birthdays.
So what makes the perfect budget to go along with a checkout routine?
"Don't forget to budget for real life," said Kumiko R. Love, founder of The Budget Mom, and "prioritize your financial goals."
Real life expenses could include home improvement costs, special occasion expenses, or even unexpected life events.
Taking these types of expenses into account, while ensuring you have enough money to meet your financial goals, can help reduce unnecessary waste.
Love suggests creating a budget that represents the least amount of income you can receive.
This is to ensure that your budget will always be within the threshold of the income that you can generate.
What to do if your budget does not reach you at the end of the month?
Create a plan
Don't wait until your pay comes in to decide what to do with it, Love said.
You start outlining your plan before the money arrives.
"The plan really has to happen before payday," he said.
That's where a lot of people get into trouble.
They wait to create a plan for their expenses or budget, until they get paid.
A good place to start is to review your last pay period to better understand how much you earned and to break down your salary.
Having an idea of these numbers, before the day you receive your salary, is useful to draw up a routine and a budget.
You should also review your budget and financial goals before you get paid.
By doing this, you can ensure that you won't spend your salary once it hits your bank account, Castro says.
"Most of the time, when you are clear and aware of your money and your spending patterns, it helps you stay on track by living within your means."
Also, make sure you pay attention to the other items in your salary, not just what you earned in that pay period.
"Understand what group benefits you can receive and pay, how much you can be contributing to a retirement plan and how much your employer is matching, and your tax withholdings," Castro explained.
This will give you a clearer idea of where your money is going, areas where you can increase or decrease your contributions, and most importantly ensure accuracy.
Your roadmap should also include any financial goals you may have, such as paying off debt, saving for an emergency fund, or exploring a side job to generate more income.
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Get your routine going
Once you've defined your budget and plan, it's time to put your routine into action for the day you get paid.
Love suggests taking 15 to 20 minutes every fortnight, or every time you get paid, to implement your routine.
"Have the plan in front of you when you receive your paycheck, so you have a clear plan of where you should invest your money," he said.
A common strategy for the fortnight is to pay yourself first.
In other words, prioritize your savings by automating your bills and savings every month.
From there, you can track your expenses for that pay period, make any necessary changes to your budget, and review your progress on your financial goals.
You can also try implementing the cash envelope method.
Simply put, divide your income into envelopes that represent different expenses and expense categories, such as groceries or gasoline.
The point is to spend only the cash available in each envelope for each category until the next pay period.
"It gives you a better idea of what's going out and what's going in over an extended period of time when it comes to your money," Love said.
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Stay with that
Financial habits, like payday routines, must be maintained.
But sticking to a routine can be difficult.
Life can get busy and unexpected expenses can arise.
One approach Castro suggests is to schedule regular checks on your finances.
You can configure them as recurring events on your calendar so that you can commit to them no matter what, he said.
"The biggest difficulty people tend to face when establishing a payday routine is simply starting out strong but then deviating from their routine," Castro said.
"You have to stay committed and motivated to stick with your money routines until they become a habit."