8 Simple Budgeting Tips For Getting a Month Ahead on Your Bills

jar of coins
 
Here’s how most budgets work:
 
You assign money to spending categories based on what you expect to earn that month.
 
And that’s how I used to do budgeting. You probably do too.

But I get asked all the time:
 
What’s the best way to pay bills each month?
 
It comes down to following these four simple budgeting tips:
 
  1. Give Every Dollar a Job
  2. Save For a Rainy Day
  3. Have an Emergency Fund
  4. Live on Last Month’s Income
 
If you’re a fan of the You Need a Budget software, then you’re no stranger to those principles. They make sense.
 
The first three are pretty straightforward.
 
Be smart with your money and save it. Build a safety net and don’t panic when things don’t go perfectly. Pretty simple.
 
The challenge for most people, though, is living on last month’s income.
 
What does it mean? And how do you do it?
 
The idea is simple:
 
Spend this month, what you earned last month.
 
So how do you make it happen? Here are 8 tips to make this work:
 
(This post may contain affiliate links. Check out our full disclosure policy here!)
 
 

Your Challenge:

napkin with goals written on it

Here’s what it comes down to:
 
You have to budget your money.
 
Creating a written budget is the only way this plan will work. So commit yourself to this process by completing all the steps.
 
I recommend creating a zero-based budget. Zero-based budgets just mean that every dollar gets assigned to a category.
 
Here’s an example:
 
example of a zero based budget
 
So if you have $100 leftover for the month, then you need to assign it somewhere. Fun money, savings, retirement – wherever. Just make sure you put it in a category.
 
People who use zero-based budgets pay off 19% more debt and save 18% more money.
 
It keeps you accountable and makes you less likely to waste any leftover money.
 
Now let’s get started with the steps.
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“A budget is you telling your money where to go instead of wondering where it went.”
 
-John Maxwell
 
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Step 1: Focus on ‘extra’ money

pink piggy bank
 
There are several months out of the year that have five weeks instead of four.
 
This means if you stick to your budget, then those bonus checks will be all you need to get a month ahead. 
 
Here are the months that have five weeks for 2019 and 2020:
 
  • 2019: March, May, August, November
 
  • 2020: January, May, July, October
 
But to take it a step further, you should start saving money you weren’t planning on having anyway.
 
For example:
 
  • Save your tax refund
 
  • Save your bonus check
 
  • If you get a raise, stash the extra money away
 
  • Clear the excess by having a garage sale or selling stuff online
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“Budgeting has only one rule: Do not go over budget.”
 
– Leslie Tayne
 
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Step 2: Create an Emergency Fund

man showing wallet full of money
 
Emergencies happen.
 
And that’s what your safety net is for.
 
So for these simple budgeting tips,  I want to focus on emergency funds.
 
Here’s why they’re important:
 
Your emergency fund is what prevents you from going into debt when an unexpected expense pops up.
 
But here’s the thing:
 
Getting a month ahead essentially functions as a one-month emergency buffer. It’s your starting point.
 
The ultimate goal is to become debt free and save for 3-6 months worth of household expenses.
 
But if you have debt (not couting your mortgage), then you should start by saving $1,000 first.
 
If you’re completely debt free, then you can skip to step five of this article.
 
__________
 
“Don’t tell me what you value, show me your budget, and I’ll tell you what you value.”
 
-Joe Biden
 
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Step 3: Take the weight off

woman budgeting
 
Your mission is to get out of debt.
 
But here’s a common trap many people fall into:
 
They try to get a month ahead while still having debt. And if that’s you, I want to redirect your focus.
 
So you’re going to factor all your debt payments into your “get ahead” budget?
 
Where does that leave you?
 
Still in debt.
 
Not good. So your first step is to save $1,000 for your emergency fund then focus on becoming debt free (not counting your mortgage).
 
Your $1,000 fund will be your barrier against new debt. 
 
And becoming debt free will reduce your monthly bills. That’s what we want. 
 
So here’s the deal:
 
For many of us, we come to the realization that throwing money at debt without a plan isn’t the quickest way to get rid of it.
 
So choose a debt payoff method instead.
 
I recommend the debt snowball method or the avalanche method. And if you’re unsure which one is right for you, then I want you to read this first:
 
 
The last point I want to touch on with debt is this:
 
When you’re paying off debt, pause on saving in other areas.
 
Yep, I mean it. To really tackle your debt as quickly as possible, you’ll need gazelle intensity.
 
Put a pause on retirement contributions and vacation sinking funds.
 
Pause on trying to pay your mortgage off early.
 
Follow these simple budgeting tips and you’ll be successful.
 
Plus, you’ll pick back up your savings and retirement once you become debt free. And you’ll be able to make up for it 10 times over.
 
__________
 
“If you think nobody cares if you’re alive, try missing a couple of car payments.”
 
-Earl Wilson
 
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Step 4: Look for Flexibility

man typing on laptop
 
Two things I want to talk about here are:
 

1. Lowering your interest rate

 

2. Working with your due dates

 
First things first: interest rates.
 
Interest rates are tricky. And they’re what costs us so much more in the long-run.
 
So if you only make minimum payments on your credit cards, it can take years and years to pay them off.
 
So what should you do?
 
First, stop adding more debt. Step away from the credit cards.
 
Secondly, use a company like SoFi to lower your interest rate for you. SoFi offers student loan refinancing and personal loans.
 
If you’ve never heard of student loan refinancing, here’s what they do:
 
They take all your loans and combine them into a single loan with a lower interest rate.
 
As a result, you’ll have a single student loan provider and a lower monthly payment.
 
This is one of my favorite tips for keeping your finances organized. Because instead of having several statements coming in each month, you’ll only have one.
 
SoFi also offers personal loans which consolidate other debt like credit cards.
 
So just because you can’t afford to pay off the balance completely, don’t settle for a high interest rate.
 
Note: The SoFi link above gives you a $100 welcome bonus.
 
And here’s another one of our simple budgeting tips:
 
Negotiate your due dates if you’re having trouble paying bills because they’re due around the same time.
 
Spreading out your bills over the month can allow you to have enough ‘wiggle’ room.
 
This can be as simple as changing your due dates online or by making a quick call to customer service.
 
And when it comes down to paying your bills on time or changing the due dates – trust me – they’ll be willing to work with you.
 
Once that’s done, you can organize your due dates and set reminders to help you stay on track.
 
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“I make myself rich by making my wants few.”
 
-Henry David Thoreau
 
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Step 5: Save While You Spend

man smiling while looking at cellphone
 
I like to save money on everything I buy. And I like to keep things simple.
 
So my favorite way to save money is by using a cash back app called Ebates.
 
I’m sure you’ve probably seen the commercials for Ebates, but in case you haven’t, here’s what you do:
 
You sign up for an Ebates account (it’s free) and use the search bar to find the retailer you want to shop with.
 
Here’s what that looks like:
 
Ebates homepage gif
 
As you make purchases, you’ll get cash back.
 
I’ve been using Ebates since 2013 and I’ve earned over $1,000. Last year we replaced a kitchen appliance and I got $63 from that purchase alone.
 
It’s been a great way to save money without having to clip coupons.
 
Note: the Ebates link above gives you a $10 bonus for signing up and shopping.
 
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“You can only fix a financial problem by fixing yourself.”
 
-Nancy Levin
 
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Step 6: Cut Low Value Expenses

man writing his budget
 
Here’s the bottom line:
 
Most of us can find ways to cut expenses from our budget.
 
We’ve made it far too easy on ourselves to spend money.
 
Plus, we’re creatures of habit. We shop at the same places, eat at the same restaurants, and still swipe the same credit cards.
 
How much are your old spending habits costing you?
 
Financial success comes down to this:
 
Change the way you manage your money, adopt better habits, and stick to them.
 
So use these simple budgeting tips to your advantage:
 
Pull out your bank and credit card statements and take a hard look at your expenses.
 
Look at your receipts for the last four weeks.
 
If you could cut out three or four things, what would they be?
 
Here are some tricks I use:
 
1. Remove Your Card Information from Online Retailers
 
And while you’re at it, unsubscribe from retailers newsletters.
 
2. Beware of the “free” trials
 
You know, the ones you forget to cancel before the trial runs out. Also, beware of “limited time only” deals.
 
Marketers are smart. They know you’re more likely to buy if there’s a time limit.
 
3. Bank Fees
 
Have you checked your bank statements lately?
 
Not saying any names, but at my previous bank, there was a fee for everything. single. thing.
 
An account maintenance fee here, a card swipe fee there, and even a fee for not keeping a certain amount of money in the account itself. What kind of weird punishment is that?
 
So it’s the main reason I switched to a Capital One 360 Account. No fees, easy to set up, and I can use my debit card without charges.
 
4. Cancel Anything You Aren’t Using
 
Like gym memberships and subscription services.
 
I cut the cable last year from $170/month to $8.25/month (or $99/year) by switching to Amazon Instant Video instead.
 
I just didn’t feel like we were getting that much use out of cable. Definitely not enough to justify paying that much for it.
 
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“Instead of figuring out how to make ends meet, work on having fewer ends.”
 
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Step 7: Earn Extra Money 

picture of organized desk
Some people already live on a bare bones budget.
 
They already follow these simple budgeting tips. They cook at home, meal plan, trade in their car, lower their interest rates…and they still struggle to get ahead.
 
But if there’s one thing that being tight on money teaches you – it’s how to hustle.
 
So there are lots of ways to make money.
 
Plasma donations, cleaning houses, babysitting, and selling stuff you don’t need – show you that earning money is sometimes about thinking outside of the box.
 
We talk about more side hustles in our article: How I Made $5,500 Last Month From Home.
 
So if you missed it, check it out. 
 
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“The quickest way to double your money is to fold it over and put it back in your pocket.”
 
-Will Rogers
 
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Step 8: Create Savings Goals

woman using laptop
 
Successful people set goals for their money.
 
Do you want to save for retirement?
 
Set aside a down payment for a new home?
 
Go back to school?
 
Know your purpose. 
 
Once you’ve gone through the steps of paying off debt and setting aside for a rainy day, this is the next chapter of your story.
 

Final Thoughts:

Here’s the best part about using this strategy:
 
A) It reduces stress 
 
You won’t worry about ‘making ends meet’ because you’ll have money to cover everything.
 
What you earned in January covers February, and so on and so forth.
 
B) Budgeting becomes easier
 
Budgeting becomes easier when you aren’t strapped for money.
 
C) It sets a strong precedent for spending less than you earn
 
The most simple yet overlooked financial principle is this:
 
Live within your means.
 
Credit cards and car payments make us lose sight of living within our means.
 
We can “afford” it because we can make the monthly payments.
 
…right?
 
At least that’s what we tell ourselves.
 
But here’s the deal:
 
When you get a month ahead, you’re actively living within your means.
 
And that sets a powerful financial precedent. 
 
D) You can quit timing your bills
 
You don’t have to worry about being late on bills.
 
You don’t have to wait around until the end of the pay period to pay them.
 
Think about how good that would feel.
 
Thanks for reading.

 

6 thoughts on “8 Simple Budgeting Tips For Getting a Month Ahead on Your Bills”

  1. Waouh! This is the most instructive and useful article I’ve read about managing personal finance. Thank you so much ! I can now throw away all the 100 other articles I saved to keep just this one. Thank you again you saved me so much time and Money.

    • I’m glad you liked it Carmela!

  2. Thank you so much for this post….It came to me when I really needed to read it!

    • You’re welcome Erin. Let us know how it goes!

  3. pretty informative but I am a little confused about the month ahead part. are you always going to stay a month ahead if you follow that concept?

    • Hi Donna! Yes, the goal is to always stay one month ahead and those tips will help you do so. Thanks for reading!

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