Why You Need a Weekly Budget
A monthly budget is an intuitive default—but a weekly budget might be the better option.
Not to say you shouldn’t use months to frame your budget. Most bills are due once a month, you might get paid once or twice a month, and budgeting software often starts you out fresh each month. But if your monthly budget is your big-picture strategy, the weekly budget planner is your tactical plan that ensures you stay on track.
Creating Your Weekly Budget Planner
The transition from a monthly to weekly focus isn’t particularly difficult, but it does take a little upfront planning.
First, know that you might not want to use a weekly budget for every category. Sticking with monthly tracking for fixed monthly bills, such as mortgage payments, could make more sense. The same goes for other fixed bills, like bi-annual insurance premiums or annual car registration fees, which you can break up and include in your monthly budget. You may even want to continue tracking variable yet consistent expenses, such as gas or transportation, monthly.
However, discretionary expenses—meals, entertainment, and the like—are where it’s easy to stray off course and overspend. That’s where making the strategic shift to weekly budgeting can help.
Here are three big benefits of using a weekly budget planner:
1. It’s Easier to Avoid Overspending Early On
The suggestion isn’t a whimsical idea, either. There’s science to back up the change to weekly budgeting.
Duke University’s Center for Advanced Hindsight approaches a wide range of topics from a behavioral science perspective. It’s Common Cents Lab, led by behavioral economics professor Dan Ariely, tackles financial challenges facing low-to-moderate income households. But the results can be insightful regardless of your income.
One study found showing SNAP benefits recipients weekly rather than monthly balances led to families spending the money less quickly. As a result, they had money for food further into the month.
You’ve likely had a similar experience. At the start of the month, your entertainment budget is filled to the brim, and you find yourself dipping into it frequently.
Several weeks later, the category is depleted but there’s still another weekend approaching. You then find yourself going over budget, moving money from another category, or fudging the category for your expenses to make things add up.
A weekly limit can make it easier to avoid the monthly boom and bust cycle.
2. There’s Less To Think About
If you’re already a budgeter switching to the weekly plan isn’t necessarily more work. Your budgeting software and methods can stay the same for the most part, just break up your monthly discretionary funds into weekly amounts.
In some ways, the weekly time frame can make things easier because you don’t have to worry about how your actions will impact the entire month—just focus on one week and then move to the next.
Of course, mistakes and emergencies happen, and you might spend more than you planned. But this happens with monthly budgeting as well. The weekly time frame makes it easier to notice the overspending and allows you to react more quickly, helping you get back on track within a few weeks rather than months.
3. Saving and Paying Off Debt Could Become Easier
You can also make strategic switches to weekly tracking to align with your goals. For example, if paying off debt or saving money are top priorities, you might want to make more frequent transfer part of your weekly budget plan.
Another Common Cents Lab study found that smaller, more frequent debt payments could lead borrowers to repay more money each month than a single, large monthly payment. (You can read more about it in the 2018 Annual Report on pages 110 and 111.)
Particularly if you’re paying down high-rate credit card debt, making weekly or bi-monthly payments could help you pay off the balance faster. Even if you don’t allocate more money to the bill each month, you’ll wind up paying less interest overall because credit cards accrue interest daily.
On the flip side, if you’re focusing on building your savings, you could make more frequent transfers into savings and retirement accounts. The same principle applies—it’s easier to swallow regular bite-size transfers.
Starting Your Weekly Budget
Making a change to your budget can be difficult, particularly if you’ve been using the same system for years. However, an occasional test can’t hurt. In the end, you may find your method works best for now. But at least you’ve challenged your assumptions and looked for more efficient ways to manage your money.
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