The Weekly budgeting philosophy is different from most other budgeting apps. Other apps make you budget a month at a time or use your checking account balance as a basis for your budget. We believe these approaches don’t match natural human behavior and make it harder to manage spending. Weekly is different.
Weekly uses your average income and bills to determine how much you can safely spend each week. We then track your spending against that number to keep you on track. This approach does two things:
- It provides a realistic amount you can spend each week
- It separates spending from cash flow
Let’s look at each of these points.
Weekly Spending Limit
The average amount you can spend each week is called your Weekly Spending Limit. This amount is based on your regular income, your bills, and your savings goals. What’s left is money to spend on all your day-to-day needs like groceries, gas, entertainment, clothes, etc. Having this as a single number can help you be realistic about your budget. It’s also much easier to manage spending since you’re only managing seven days. Each time you start a new week your Weekly Spending Limit is added to you what you can spend.
This approach brings your budget more in line with natural human behavior. You can plan for shopping, groceries, gas and everything else for just the next seven days. At the end of the seven days you can rinse and repeat.
Separating Spending from Cash Flow
Your Weekly Spending Limit is detached from your actual cash flow. It’s not based on your checking account balance or when you’re paid. This can help avoid the cash flow rollercoaster – feeling rich when you get paid and broke after paying your bills. With Weekly you have the same amount to spend each week. This simple change helps create healthy patterns of regular spending.
Managing Cash Flow
Although your cash flow is not tied directly your budget, it is important to manage. In general, if you spend less than your Weekly Spending Limit you’ll have enough money for your bills. But if you’re just getting started and don’t have any cushion in your bank account, you may need to monitor your cash flow more closely and reduce spending while you build up some extra cash in the bank.
Fortunately, Weekly has several tools to help you manage cash flow. The Upcoming Items Report shows when your income and bills are scheduled to hit your bank. The Cash Forecast combines the upcoming items with your current account balances to forecast your cash balances. This can be very helpful to see what your expected cash low point is. You can also enable bill notification reminders to get a push notification a few days before your bills are due.