How to survive the January payday stretch
Every year approaching December, money-conscious individuals have one major concern; surviving from their mid-December payday until their next pay day at the end of January.
If you don’t have this concern and find yourself struggling throughout January, you probably should start being concerned.
In reality, this shouldn’t be a problem, but psychologically, it becomes one.
What usually happens is that we receive our monthly salary and mentally accept that as the total disposable funds for the month. We then apply our budget or mental expense tracker to that amount and seem to survive, even if just barely.
What happens during the December/ January payday stretch is that our December salary reaches our bank accounts way before the actual pay date. We then accept that as the total disposable income available to us for the entire term until our next payday. Problem is however, our brains often fail to keep January’s expenses in scope. So, as we carry on spending in December, we are met with the comfort of “enough” money left in our account. Come January, we suddenly realise that there are several expenses that need to be covered. The result? Limited, little or even no funds left to cover essential expenses during January.
Let’s cut to the chase.
How this payday stretch should be approached
- Transfer your December salary to another account
If you have a savings facility attached to your bank account, transfer the full amount into it. If not, pay it into any other account on your name, or if you have a safe, withdraw what’s left of your November salary. You can then store your card and that cash amount in your safe and continue the rest of December working with cash only.
- Split your bonus (if applicable)
If you get paid a bonus, add half of it to your November salary and add the second half to your December salary. You then have some extra financial aid in January to save up or just to live more comfortably.
- Stick to a holiday budget
Map out all expenses you should and would like to make and make sure all commitments and even goals are met.
- Pay as many of January’s expenses in December
If you have met all of the above commitments and goals and there is enough money left for socialising, fuel, et cetera on your November salary consider paying January’s expenses in December already. If not, access your December salary only to complete all necessary transactions (rent, debt etc) and then put it back where it belongs until January.
By following these tips, you will have a smooth ride into the new year, guaranteed.
But, seeing as it’s already January, if you haven’t followed a plan similar to the above you are likely to have started feeling the pinch.
What you can do now to survive January
- Reallocate your available funds
Take all funds you have available, less necessary debt and split it up evenly equal to the number of weeks left for the month. Then work out a set weekly budget and follow it. For example, you have R2000 left, all your debt is paid, you can budget as follows: R2000 divided by 2 weeks = R1000 per week. R400 for petrol, R200 for food, R150 for lunch at work, R100 entertainment and R150 for spending/ emergency fund. The key to making this work is only spending your weekly budget and prioritising the expenses when you count. (eg; Petrol and food is priority, entertainment isn’t.)
- Don’t borrow money
Making more debt at a time like this is a serious step backwards. You can easily remain in debt until the middle of the year. Rather opt for a debt eluviation service such as Senator Counsellors’ Voluntary Surrender of Estate. If you really need money to survive, look for non-essential goods you can sell, get an evening job as a barman/ lady, pizza delivery man/ woman or ask friends or family for some assistance with food etc.
- Consider consolidating petrol expenses
Ask your colleagues (who are likely also in a bit of a pinch) who stay near you whether you can drive with them in exchange for a portion of the petrol. Try to fill the car for minimal fuel expense.
- Buy budget food
Look at the month still ahead and purchase food products that are both cheap and practical. This purchase should cover you for the rest of the month. Instead of trying to buy a few loaves of bread that won’t cover you for the duration of January, buy flower and bake your own. Buy things such as pasta, maize meal and rice. If things are really bad, buy soya mince rather than minced meat.
January is a rough month for everyone, but it shouldn’t be. Follow the advice above and, if your finances are really in disrepair, feel free to contact us for proper advice to combat your debt permanently. Hang in there; the shortest month of the year is around the corner.