No matter how often you’re paid – once a month, twice a month, or every other week – weekly budgeting works. Budgeting on a weekly basis makes it easier to keep track of personal spending and stay on a budget. The reason for this is because as humans we naturally organize our lives a week at a time. We go to work for a week, we have weekends with our families, we usually buy gas and groceries every week. It makes sense to budget on a week.
The key to weekly budgeting is to find out how much you can safely spend each week after accounting for all your committed expenses. Once you figure out what you can safely spend in a week, and have a reliable way of keeping track of your day-to-day expenses, you can move through your weeks with more confidence and less anxiety.
Within Weekly, our weekly budgeting app we walk you through the process of setting up a weekly budget. We’d love you to give it a try! But for those that are curious or want to do this for themselves in a weekly budgeting template spreadsheet, we will show you below exactly how we go about calculating your Safe-To-Spend so you can create a weekly budget on your own.
How do you figure out what you can safely spend in a week? The process is to break down your regular income and committed expenses into the equivalent weekly amount and then you then subtract your weekly equivalent expenses from your weekly equivalent income to get your weekly Safe-To-Spend. Then you give this Safe-To-Spend amount to yourself each week — you can think of it as an adult allowance — to spend it on the day-to-day expenses you buy.
Here are the steps to creating a weekly budget. TIP: It helps to have your main bank and credit card statements ready.
- Write down how much do you get in your paycheck and how often you get paid.
- Figure out your equivalent average weekly income.
- Make a list of all of your committed expenses.
- Calculate the weekly average of your committed expenses.
- Subtract the average weekly expenses from average weekly income. This is your “Safe-To-Spend”.
- Keep track of daily expenses
Read on for all the details!
Grab your paycheck(s) and write down your regular income.
First, find your paycheck and write down the net amount, that is, the amount after taxes. Then write down how often you’re paid – monthly, twice a month, every two weeks, weekly, every 3 month, every 6 months or even yearly. If you have multiple jobs or sources of income in your household, write them all down.
Next, calculate your average weekly income from your paycheck(s)
To find your average weekly income you need to know your net paycheck amount and how often you’re paid. Using your net income simplifies the calculations because taxes and other deductions have already been taken out.
Find your pay frequency in this chart and multiply your net income by the multiplication factor.
| Pay frequency | Multiplication factor |
| Weekly | 1.000 |
| Every two weeks | 0.500 |
| Twice a month | 0.4603 |
| Monthly | 0.2301 |
| Every 3 months | 0.0767 |
| Every 6 months | 0.0384 |
| Yearly | 0.0192 |
If you have more than one paycheck, do the same for each paycheck. For example, if you made $1,250 twice a month, you would multiply that by 0.4603 to get your weekly equivalent which in this case is $575.38.
Then, find all your committed expenses
Now that you know your average weekly income, the next step is to discover how much money you need each week to cover all your committed expenses like bills, loan payments, and subscriptions. Committed expenses occur at regular intervals (often monthly) and are for a known amount. Some committed expenses happen quarterly or yearly like an HOA payment or a annual membership fee. It can be helpful to pull up your bank and credit card statements to find all your committed expenses.
It’s important to identify all your committed expenses when making a weekly budget so set your weekly Safe-to-Spend too high. Here’s a list of committed expenses to prompt you.
| Category | Item |
| Housing | Mortgage/Rent |
| HOA | |
| Yard Care Subscription | |
| Bills & Utilities | Cell Phone |
| Internet | |
| Cable | |
| Natural Gas | |
| Power Bill | |
| Water Bill | |
| Trash | |
| Transportation | Car Payment |
| Bus Pass | |
| Auto Insurance | |
| Yearly Registration | |
| Loan Payments | Student Loans |
| Personal Loans | |
| Medical | Health Insurance Premiums |
| Health Savings Account | |
| Subscriptions | Dental Insurance Premiums |
| Disney + | |
| Netflix | |
| Hulu | |
| Spotify | |
| Apple Music | |
| Pandora | |
| Amazon Prime | |
| Cloud Storage | |
| Xbox | |
| Health/Beauty/Fitness | Gym Membership |
| Ipsy | |
| Supplements Subscription | |
| Education | Tuition |
| Kids | Kid’s School |
| Daycare | |
| School Lunch | |
| Child Support | |
| Donations | Tithes |
| Charity | |
| Savings & Goals | Emergency Fund |
| Car Maintenance Savings | |
| Medical Savings | |
| Holiday Savings | |
| Vacation Savings | |
| Other | Other 1 |
| Other 2 | |
| Other 3 |
Now calculate the weekly average for your committed expenses
To find the weekly amount needed to cover all your committed expenses, multiply each committed expense by the multiplication factor in the chart above. So if you spend $8.99 a month on a subscription, you would multiple that by .2301 to find how much that is per week (which is $2.07). If you spend $500 a year on a pool membership, that would work out to $9.60 a week ($500 * 0.0192 from the chart above).
HINT: You can download our weekly budget app or our spreadsheet to help with these calculations.
Do this for all your committed expenses.
Now for the result … your “Safe-To-Spend”!
Take your weekly income and subtract your weekly committed expenses to find your Safe-To-Spend. This is the amount you can safely spend each week while still keeping enough money set aside for all your committed expenses. As long as you spend less than that amount each week you’ll be set.
Let’s say you get done with your week and you have money left to spend. Awesome! You can roll it over and spend it the next week – or, better yet, invest it.
What about groceries and gas?
Yes, these expenses happen on a regular basis, but they are also influenced by behavior. For example, if you wanted to save up to go to the movies this weekend, you could decide to shop at a discount grocery instead of a high-end store, for example, and save that extra money. Similarly, you could bike to work maybe once a week to save money on gas. Because these expenses fluctuate and are impacted by behavior, we recommend including them in your Safe-To-Spend money.
That being said, if you have a regular job that you commute to every day for example and a car that you have bought that is not likely to change for a while, you can absolutely add in the amount you regularly spend on gas getting back and forth to work as a committed expense and lower your Safe-To-spend.
Remember, your Safe-To-Spend is different than cash flow.
Just be aware, because you have abstracted your finances one level up, the amount in your Safe-To-Spend won’t match the amount in your bank account. This is because we have abstracted the monthly, quarterly, and yearly expenses and spread them out over a year even if they are paid once. Make sure you have enough cash in your checking account to cover your upcoming bills and your safe-to-spend. When you get into a pattern of spending less than you earn on average, this won’t be a problem for you.
Keep track of your daily expenses.
So now you know your weekly Safe-To-Spend. But next is to figure out how you “give” this to yourself each week and keep track of how much of your Safe-To-Spend you have already spent. Here are some options.
Cash
Take your weekly Safe-To-Spend out of the bank in cash. This is akin to the envelope system. But in a digital world, this may not be entirely feasible.
Debit card
Every week, automatically transfer your weekly Safe-To-Spend to your debit card account. Use this debit card to purchase everything. Then if there is anything left over then you can save it for the next week or invest it. You can then monitor the amount on this card on a regular basis to make sure you are not going over or keep track of your expenses on a spreadsheet so you can make sure you don’t overspend.
Use Weekly!
If you don’t want to open a new account and transferring money every week and the hassle of keep track of expenses, you can download Weekly. This is an app that connects to your current bank accounts, downloads your transactions, and keeps track of your Safe-To-Spend.
Conclusion
The reason weekly budgeting works is that it takes into account human psychology first. To put it another way, you operate on a weekly basis in your life so your budget should too. Budgeting weekly also gives you peace of mind while allowing you the flexibility to enjoy life — which will end up making sticking to a budget easier.
