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Money in at different time of month to money out - how do I organise myself?(17 Posts)
I am 60 and should know how to do this but I don't so I thought I would ask the collective wisdom on here about how I can get better organised regarding money in, money out.
Before I retired I was used to salary on last day of the month, all bills out by direct debit on 1st of the month. Because of my past employment history/widow's pension I now get 3 lots of money scattered throughout the month. The biggest lump comes in on the 21st then 2 smaller bits on the 10th and 16th. Most of my bills still go out on the first working day of the month.
On paper I should have enough to cover all my expenses but it always feels very tight at the beginning of the month.
Any advice on how I can organise myself? Can I ask my pension providers to change the date I get paid do you think? I can't see the wood for the trees on this so any help very gratefully received.
We have the same issue since DH went self-employed. What we have ended up doing is putting all income straight into an easy access savings account, and then paying ourselves a monthly 'salary' from that on the same day each month.
So we are basically being paid monthly still, it just comes from savings rather than an employer.
You could change DD to 16th of month then all your money is "in".
See if you can change your DD days. Some I know are easier than others. Hence I have bills scattered across the month. Nightmare.
So on the whatever of every month I have the bulk of my income. Straight away I take from this every single bill due that month. This is put straight into a separate account which has all my DD's.
Then the little bit left from the bulk, along with the two other payments over the month pays for everything else. So to make things simple, all the left over is added together and divided by how many weeks until the next big income
Some really good ideas here thank you. I like the idea of the separate DD account and hadn't thought of that. I knew you would all come up trumps so I am going to give that a whirl and see if it helps.
We have a separate DD account and wages account.
On payday, both of our wages (paid on same day) go into the wages account. I have automatic transfers set up to send money over to the DD (bills) account. I have a transfer for each separate DD (i.e. mortgage, utilities, mobiles) so I can manage any variations in monthly amount - for example if gas and electric goes up or down after a quarterly bill. Then each separate DD comes out of the bills account on the date it was set up for.
This way I know there's enough money in the bills account for all bills each month, and that whatever is left in the wages account is our disposable income for the month
We use YNAB (you need a budget), which encourages you to have enough money for the month ahead. It has revolutionised the way we save and spend.
Although it is now subscription only, you could read the free online tutorials and follow the same principles, but set up a spreadsheet.
To add to that, you could make your savings account off budget, and decide how much is in your actual budget to meet bills.only spend what is in your actual budget
Having a look at YNAB now. It would be lovely to have a month in hand.
It may take a while to get a month in hand, or, maybe transfer money from savings into your cash budget to put yourself in that position.
Think in terms of cash budget (ie money in your budget NOW), rather than which accounts it sits in.
Then, allocate the money from that budget to meet the upcoming bills.
Divide annual bills by 12 and allocate this per month.
Include a contingency section.
I hope that makes sense - the ynab videos explain it better.
We had a similar issue when DH changed jobs and his payment date changed. We get paid roughly the same (but into sole accounts which we transfer into the joint account).
We have DDs and standing orders set up to go out of the joint account so that half our outgoings were paid out just after the 1st of the month and the other half just after the 16th (we are paid on the last day and the 15th). This way we don't get the 'end of the month' feeling.
When his payday changed, his pay just sat in his sole account until it was the end of the month, then we transfer to the joint account to cover 'his half' of the outgoings.
If you can't change the date of the payments in, look into rearranging the outgoings according to how much is coming in eg £200 in to cover 3 x £50 direct debits with £50 spare until your next payment in.
We have a DD account and a spending money account. Wages go into the DD account and I leave in enough to cover the DD's that month. Everything left over is transferred to the spending account and divided by 4 so I know how much I have each week.
I already have 4 accounts with my bank (2 current and 2 savings) so I can definitely reorganise things so that when my pension goes in I can leave enough for the DDs and then transfer the rest. I have been trying to do it the other way round if that makes sense.
I've got a separate account for DDs and it's definitely the best way to go.
Just add up the total amount for bills over the month and transfer it into that account. The what you have left in your other account is your "spending" money.
I have two accounts.. One I get paid in and use everyday for food and shopping and a house account all my direct debts come out from
So when j get paid I transfer to the house account the money needed to cover the bills and then know the rest is my money
YNAB all the way. Once you've done 2 months with YNAB you'll never look back
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