Tuesday, November 11, 2008

Weekly Budget Planning - This week.

Payday is tomorrow...

Well, it is actually Thursday, but with the magic of direct deposit, it should hit my checking account in about two hours, well, that is if the Veteran's Day holiday doesn't mess it up.

This is a good paycheck week! This, is my bonus week. Every month, I get a bonus based upon the profitability of my department, as well as the business. If you listen to the news, the automotive business is almost dead, but apparently, we are the exception to the rule, because we are doing OK, or at least up until this month.

So, I used my Excel spreadsheet that I have custom made to plot out where the money should go. Since I am salaried, my base pay is always the same, so it is easy to plan that out a day in advance. I have a spreadsheet that calculates my bonus based on the formula that the company uses. I am usually within a couple of dollars, but the withholding amounts are always a bit confusing.

At any rate, I inserted what I thought would be my bonus amount (I estimated a bit low), and proceeded to plan my spending. We put another couple of hundred into the Christmas fund for the kids. We have funded most of Christmas last month, but we wanted a bit more, just to be sure. If we do not spend it all, it can be re-allocated. What a feeling it is to get to the end of my accounts, and have some extra money!

I fund quarterly expenses (life insurance payment, water bill, and a couple of others), semi-annual expenses (property taxes), and yearly expenses (homeowner's insurance) out of my monthly bonus checks. I fund most of my weekly and monthly bills out of my weekly paychecks, such as the mortgage, food, doctor's co pays, etc. I decided to do this back when I started this planning. The thought was that if I had a month that we didn't do so well, and I did not make a profit, and therefore no bonus, that I would have some more time to adjust over the next month or two, and make up for it out of future bonuses. Of course, this could be a bit more of a problem if I had extended months without bonuses, but there would also be some serious issues if this were happening, and it would call for strong measures anyways.

At any rate, where I was getting at, was that I had some money left over. I also love my budget plan, because I can look ahead. I really think that the bonus situation will not be as good next month. So, I funded my life insurance fund with two months worth of payments, as well as the water bill. I was able to put 1 1/2 months of payments into property taxes.

But all is not lost, as December is a five week month. In addition, there is a Christmas bonus next month, as well as (hopefully) a year end discretionary management bonus. And, I still should make a regular bonus. And hey, with many of my accounts funded, I should be continuing to get ahead. My goal is to take the Christmas and discretionary bonus, and invest them in my emergency fund. I have a pretty aggressive goal for an emergency fund... $20,000 by the end of the year next year.

I definitely encourage you, if you don't do so now, to make a budget, a financial control, and stick with it. The changes in your life will be amazing!

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