For most people, payday is probably the best day of the week. It is something to look forward to that gets you through the grind at the office and helps you cope when the boss is making you rethink your choice of careers. It is usually on a Friday, so the work week is up and you can enjoy some rest, relaxation and recreation of your choice. Most importantly, you get paid, so you have the means to do something fun, buy something cool or take that special someone out for dinner and a movie.
For some people, payday never comes soon enough. They have often spent their previous pay cheque too quickly or carelessly and end up in dire need of money for groceries and other essentials. Sometimes that drives them to payday lenders. These businesses offer a quick bit of cash even to people with bad credit. But, they expect it to be paid back with your next cheque and with a lot of interest. Type into a search engine ‘Paydayuk’ and it will bring up a list of lenders.
Avoiding this situation is not that hard to do, but it does take some responsible planning. Everyone should make a budget based on their weekly income and expenses. Your rent and car payment should be allotted first. A little basic math can help. Sum these big expenses, divide it by four and subtract it from your weekly income. Consider that money spent each week, even if it doesn’t come out of your account until the last day of the month. Next, figure in your weekly grocery bill, but allow a little leeway for the weeks when you need to pick up some items in bulk or in in case your favourite snack is on sale.
Once these essentials are taken care of, you can get a bit creative. If you and your mates head to the pub after payday on Friday, it is only fair to allow yourself enough money for your usual consumption and a bit more to buy a friend a drink or make a toast for someone’s birthday. Enough money for a fine dinner out to get you through the humdrum of the following work week is a good idea. How much can you set aside for a new shirt or tie to spruce up your work attire? And don’t forget you may have some special occasions coming up the following week. Your mother’s birthday might mean ten quid for a box of chocolates or your one year anniversary with your significant other might call for flowers or an even finer restaurant than the fish ‘n’ chip store down the street.
After these expenses are taken care of, what does your bank account look like? If it’s in the red, you probably have to go back to the beginning and start tightening up your budget. If you have a surplus, there are two main options. You can save it: invest in your retirement portfolio or save it for a rainy day. Or you can spend it: splurge on an extra night at the pub, buy a pair of shoes to make a big upgrade to your wardrobe, or look into some big entertainment to look forward to.
Perhaps you want to see Mumford & Sons at T in the Park or want to put down some money on a winter getaway to Ibiza. Whatever it is, that extra money left over from payday is your reward for wise budgeting. So make the most of it. An unexpected expense may come up that knocks the surplus off your ledger and means a couple of weeks where payday just doesn’t come soon enough!
Relevent reading: www.oft.gov.uk for regulation.