If you’re living paycheck-to-paycheck, you’re not alone. In fact, nearly half of Americans say they wouldn’t be able to cover a $1,000 emergency expense with cash, savings, or a credit card charge that they could quickly pay off at the end of the month. But it doesn’t have to be this way! Getting one month ahead on your bills is possible with a little bit of planning and effort.
Most of us have been there before: the end of the month is 5 days away and you realize you’re short on cash.
You’ve managed to scrape and scrounge to come up with enough money to cover your bills, and then it’s time to start all over again next month.
If this sounds familiar, you’re not alone.
But what if I told you that there’s a way to break out of this cycle? A way to get one month ahead on bills so that you’re never scrambling at the last minute again.
Sounds too good to be true, right? Well, it’s not. Keep reading to learn how to make it happen.
Create a Zero-Based Budget
A zero-based budget may sound complicated, but it’s actually quite simple.
The basic premise is that you give every dollar a “job.” That means that every single dollar that comes into your account is allocated towards specific expenses; bills, debt payments, savings goals, etc.
There is no “leftover” money at the end of the month because everything has been accounted for.
When done correctly, a zero-based budget can help you get a month ahead of your bills, save money, pay off debt faster, and finally break the cycle of living paycheck to paycheck.
Determine Your Monthly Income
The first step in creating a zero-based budget is to calculate your total monthly income.
This includes your salary or wages, any side hustle income, child support or alimony payments, interest or dividends earned on investments, etc.
Be sure to include all sources of income so that you have an accurate picture of your total monthly earnings.
Create a List of Expenses
The next step is to create a list of all of your expenses for the month.
*Eventually, you’ll create your budget based on last month’s expenses.
This includes fixed expenses like rent or mortgage payments, car payments, insurance premiums, etc., as well as variable costs like groceries, gas, entertainment, etc.
Don’t forget to include debt payments (credit cards, student loans, etc.), savings goals (emergency fund, retirement account contributions, etc.), and miscellaneous expenses (clothing, gifts, pet supplies, etc.).
Be sure to list everything!
Allocate Your Income to Expenses
Once you have your income and expense numbers calculated, it’s time to start assigning your income to specific expenses.
The goal here is to make sure that every single dollar has a “job.”
That means that you will need to be very mindful of where you are spending your money and what unique needs or wants each expense satisfies.
For example, if you have $500 left over after allocating money to fixed and variable expenses, you might put $250 towards credit card debt and $250 into savings.
Or maybe $200 goes towards groceries while $300 goes towards your emergency fund.
There are no right or wrong answers here—it all depends on your unique situation and what’s important to you.
Track Your Progress
Once you have created your zero-based budget for the month, it’s important to track your progress so that you can see where you are succeeding and where there are opportunities for improvement.
There are many ways to do this, but one simple way is to grab our free printable budget template.
As each dollar comes in, allocate it towards specific expenses until all of your income has been accounted for.
Then, keep track of actual spending throughout the month by subtracting money from the appropriate expense category as needed.
At the end of the month, compare your actual spending with what you had originally budgeted.
This will give you insights into where you can improve for next month!
TRY THIS: Pay yourself first! Before paying this month’s bills, set aside some money for next month’s bills.
If you find that your expenses are more than your income, don’t panic!
There are ways to cut costs without giving up the things you love.
For example, if you’re spending too much on eating out, try cooking at home more often. If you’re spending too much on clothes, try shopping at thrift stores or online consignment shops.
There are many ways to save money—it just takes a little creativity.
Another way to find extra money is to see if there are any subscriptions or memberships that you can cancel. Do you really need that Hulu account when you already have Netflix?
Chances are, there are a few things that you can live without – so cut them out and save yourself some money each month!
TIP: Your goal should be to cut back on expenses each month and set that money aside until you have enough to pay an entire month’s worth of bills.
Automate Your Finances
Once you have a budget in place, put your bills and savings on autopilot.
Start by setting up automatic transfers into a savings account each time you get paid. This way, you won’t even have to think about putting money away for a rainy day—it will happen automatically.
And if you ever find yourself in a tight spot, you’ll have some cash set aside to help you out.
One of the best ways to stick to a budget is to automate your bill payments as much as possible—that way, you’re not tempted to overspend when you see money in your account (trust me, I’ve been there).
Use Windfalls To Build Your Buffer
When you receive a windfall such as a tax refund, work bonus, or inheritance, it can be tempting to splurge on something you’ve been wanting. But if your goal is to get one month ahead on your bills, it is better to use that money to build up your savings.
Instead of spending it, put that windfall directly into a savings account that you’ve designated for your one-month buffer. By adding these extra amounts to your savings, you’ll be able to get ahead on your bills faster.
Depending on the size of the windfall, you could make significant strides toward your goal in just one lump sum. If you receive a smaller amount, you might consider combining it with other savings or cutting back on expenses for a short period to reach your goal even faster.
Why Wait? Earn Extra Money Today!
Make More Money
If you find that your budget is simply too tight, and there’s nothing left to cut, it’s time to increase your income.
You can do this by picking up a part-time job, selling items you no longer need, or finding creative ways to make money.
Once you have some extra cash, you can put it towards your bills and start getting ahead.
Here are some relatively painless ways to make more money fast:
- Get a better-paying job: This one is pretty obvious, but it’s worth mentioning. If you want to make more money, look for jobs that pay more than your current position. It may take some time and effort to land a better-paying job, but it will be worth it in the long run.
- Get a second job: If you’re struggling to make ends meet with your current salary, why not get a second job? There are plenty of places that are always hiring, such as restaurants, retail stores, and grocery stores.
- Start a side hustle: With the rise of the gig economy, there are endless opportunities for side hustles—everything from driving for Uber or Lyft to walking dogs to renting out your home on Airbnb. And the best part is, you can usually do side hustles on your own schedule, which means they won’t interfere with your day job.
- Sell some of your stuff: Do you have any clothes, electronics, or other items taking up space in your home that you no longer need or use? If so, sell them! You can have a yard sale, sell items online, or take them to a consignment or pawn shop.
- Make extra money with odd jobs: There are always people who need help with odd jobs around the neighborhood, such as mowing lawns, walking dogs, or shoveling snow.
- Use cashback apps: Did you know that there are apps that will give you cash back for buying certain items? It’s true! All you have to do is link your credit card and start shopping. My favorite cashback apps are Ibotta, Rakuten, and Dosh.
Consider Debt Reduction
Debt can be a significant burden that prevents you from being able to get ahead on your bills. If you’re paying high-interest rates on credit card balances or loans, it can feel like you’re stuck in a never-ending cycle of debt repayment.
There are steps you can take to free up more money to put toward building your one-month buffer. One option is to consolidate high-interest credit card balances into a single, lower-interest loan. This can help you pay off your debt faster and save money on interest charges.
Another option is to negotiate a lower interest rate on your existing loans, particularly if you have a good credit score. Consider seeking out credit counseling services, which can help you develop a debt repayment plan and provide support as you work toward becoming debt-free.
By reducing your debt load, you will have more money to put toward your one-month buffer, getting you one step closer to achieving greater financial stability. While it may take some time and effort, being debt-free can benefit your financial health and give you peace of mind.
FAQs on How To Get One Month Ahead on Bills
Why should I get one month ahead on my budget?
There are many good reasons to budget a month ahead of your bills.
- You will have a built-in emergency fund (in addition to your actual emergency fund), which will help you pay for larger emergencies when they come up.
- Budgeting a month in advance is perfect for people who earn an irregular income, or who get paid weekly or biweekly.
- No more late fees
- You can stop worrying about whether your paychecks line up with your due dates.
Should I pay my bills at the beginning of the month?
Many people find it helpful to pay their bills at the beginning of the month, so they know exactly how much money they have to work with for the rest of the month.
This can help you stay on track and avoid overspending.
What if I can’t afford to pay my bills?
If you can’t afford to pay your bills, you may need to make some changes to your budget.
Start by looking for ways to reduce your expenses. Then, see if there are any ways that you can make extra money. Finally, contact your creditors to see if they’re willing to work with you on a payment plan.
What if I’m already behind on my bills?
If you’re behind on your bills, the first thing you should do is focus on paying for the necessities, such as rent, food, and utilities. Then, contact your creditors to see if they’re willing to work with you. Finally, start looking for ways to increase your income and reduce your expenses.
Why shouldn’t I pay my bills early?
If you are living paycheck to paycheck, without an emergency fund, it’s better to focus on saving up some money first. Once you have a cushion saved up, you can start setting aside money to pay your bills early.
Mission Accomplished: One Month Ahead on Bills
Getting one month ahead on bills may seem like an impossible task, but with a little bit of effort, it is definitely doable.
By making a budget and sticking to it, automating your bill payments and savings, and living below your means, you can free up some extra cash each month that can go towards building up your savings or paying off debt—or both!