5 Responsible Pay Day Habits You Should Learn ASAP

Five Pay Day Habits to Help You Get Ahead Financially

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Seeing pay day come around every week or month can be a huge relief, especially if you’re treading water financially and are finding it difficult to keep up with your obligations. Though you’d probably like to celebrate and relax your vigilance for a while, pay day is exactly the time to take stock of where you are and plan a little for the future.

Very few people learn good pay day habits until they’re well into adulthood. You can be sure, however, that making a routine out of behaving responsibly while you have some money in your pocket will make your life significantly better. You’ll find out that this is true while you’re desperately waiting for your next paycheck, but even more so in the long run.

  • Set aside some money from every paycheck, even if it’s only fifty bucks. Automate this process as much as possible so you won’t have to think about it – your future self will thank you.
  • Tally up your expenses, both regular and occasional, every time you get paid. If there’s a chance that you may run into any trouble in the coming weeks, you need to know as soon as possible and figure out where you can and can’t trim the fat.
  • It’s often a good idea to postpone large purchases, but you may also wish to buy an entire month’s worth of groceries as soon as you get paid. This ensures that you don’t have to rush to the store too frequently and end up buying stuff you don’t need.
  • Make a habit of evaluating your overall financial situation while you’re paying bills at the end of the month. Track how well you’re doing, and don’t forget to feel proud of how far you’ve come.
  • Many people who struggle between paychecks tend to splurge as soon as they have some money in their pocket. Don’t do this: rather think about how much better life will be once you’re free of debt.

“Pay Yourself First”


Author David Bach has a simple philosophy on how everyone can achieve financial security: make sure you save a portion of each paycheck the very moment you get it. Don’t give yourself a chance to spend it on stuff you don’t truly need; don’t even let bills take a bite out of it before you’ve put as much as you can into savings.

Doing this consistently will turn you into an automatic millionaire, even if you don’t earn a six-figure salary. The key is to realize that getting ready for retirement is a marathon, not a sprint. Putting away a little money every month and resisting the temptation to touch it before you have to is the only reliable strategy, and you’ll be glad to have that nest egg if some emergency strikes you and your family:

You won’t even miss that 50, 100 or 200 dollars a month once you get used to this powerful habit, but you’ll be very glad once your nest egg matures. Mr Bach’s books give you plenty of easy-to-follow tips on making this a reality:

  • Set up an automatic savings plan with your bank. If you get your salary through direct deposit, ask them to deposit a certain amount into a savings account, separate from your everyday checking account, as soon as it becomes available.
  • Out of sight, out of mind: don’t think of your savings as money available for spending, but rather you and your family’s safety cushion and insurance for the future.
  • Avoid debt unless absolutely necessary (and pay it down as soon as possible).
  • There’s a huge difference between looking rich and being rich. Buy used cars, shop for clothes based on comfort and style rather than labels and spend less money on momentary pleasures like restaurant meals.
  • You can almost certainly save $5 or so a day, meaning $150 a month, by changing your impulse spending habits – Bach calls this the “latte factor“. As you can see from the table above, small sums like these add up to quite a lot in the long run. If you can save more without scrimping, the results you’ll see will be that much better.

Prioritize Your Bills

Why don’t you quickly read through the points above again, this time thinking about what pay day habits your parents and grandparents put into practice. Most likely, they didn’t think about buying a second car until the first was paid off and they had at least a little in the bank. They cooked their own meals, even on paydays. Vacations were to a nearby lake or beach, and the family took a train rather than a flight for long distances. Most importantly, older generations saw all their expenses in terms of plain, practical functionality: a jacket that would last five years was automatically more valuable to them than one in this fashion season’s color.

Today in 2020, by contrast, we’re constantly bombarded with advertisements for stuff we don’t really need: jeans to make you look thinner, vitamin pills that don’t make you healthier in the slightest, packaged holidays that cost twice as much as a trip you plan yourself. Whereas people used to be frightened of taking on debt, most of us today use credit cards by preference. This makes it easy to fall into the trap of thinking that spending a lot of money is essential to your happiness.

Realistically, though, spending wisely is much better for your mental health. By planning ahead, you’ll be able to afford more of what really matters to you. More importantly, unlike someone who always acts on impulse, you’ll never suddenly find that you’re unable to keep up with your payments, or have to worry about going broke through a lack of foresight.

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Sketching out your budget and reviewing your expenses every time pay day comes around will therefore help you to breathe more easily. You’ll soon see that the things you like, but don’t absolutely need, eat up a larger portion of each paycheck than you probably thought. Even if you can’t cover everything this month (or perhaps then especially), categorize all your bills by how much extra they will end up costing if you pay them late.

Insurance is certainly one area in which you don’t want to fall behind, just in case the worst happens. Your landlord and utility company may also tack on penalty fees for late payments. Unless you can take advantage of a 0% APR offer on your credit cards, you will want to pay more than the minimum sum or get hammered by interest (and take upwards of a decade to clear this kind of debt).

These kinds of expenses are not optional: even in bad times, you have to keep up with them. Pay them first and in full – if you are regularly having trouble doing so, you should think about reviewing your overall finances, possibly with the help of a counselor. Many nice-to-haves, on the other hand, can be delayed or reduced. If you’re spending a significant amount on Ubers every month, consider taking the bus instead. You can’t stop eating, but there may be a number of ways to save on your grocery expenditure. Instead of buying a new appliance on credit, you can try your hand at some basic repairs. Spending less on these lower-priority items, or at least deferring those purchases until you’re sure you can afford them, will make your financial health a lot more robust.

Stock up on Essentials

If you have a problem with impulse buying, you may benefit greatly from doing as much of your shopping as possible as soon as you get your paycheck. Buying in bulk will often save you money, not just by paying lower prices, but also by ensuring that there’s always something in the freezer or pantry. Ordering takeout may be worthwhile every once in a while, but can easily get expensive if you fall into the habit of using an empty fridge as an excuse. Similarly, having to run to the store while you’re already too tired to cook dinner costs not only time and energy, but also money – gas isn’t cheap, and few people can resist grabbing a candy bar or bag of peanuts when they’re hungry.

When you go shopping based on a list drawn up while your checking account is still in good shape, you don’t ever have to run out of canned soup, pasta and frozen meals. While you’re at it, you can also gas up the car and buy all the necessities you’re sure to need during the coming month. Every dollar you spend now (which you’ll have to later anyway) isn’t available to be squandered and doesn’t give you the illusion of having more money in the bank than you do.

This weekly or monthly shopping expedition can, of course, include the little luxuries that make life worth living: a couple of bottles of wine, high-quality makeup and perhaps a magazine or two. If it’s something you buy only when you need it, like pastries or eating out, place some cash into a marked envelope and try not to exceed that amount. The point here is to purchase these items only when you know you can afford it, then resist temptation until the next payday rolls around.

Track Your Goals

Achieving financial stability without measuring how well you’re doing is nearly impossible. A great time to do this is when you’re paying bills and reviewing last month’s credit card statement. (We highly recommend that you make a habit of this, as incorrect charges sometimes get tacked on and your interest rate may change at any time).

It’s not a bad idea to keep a logbook of your progress towards your financial goals. Perhaps you’re saving up for something: seeing how your investment grows from month to month can be a great motivator. Sometimes, trying to pay off debt can feel like swimming through molasses, but noticing how your outstanding amount goes down over time will prove that you are making some progress. You may even feel inspired to start saving more and eliminate your burden sooner.


Checking up on your finances may also show you new ways of reducing your expenses. Many people never realize how much they spend on things like fast food, alcohol and lottery tickets until they add up the numbers. Even if you don’t indulge in these obvious money pits, you can probably find some area in which you can cut back. Perhaps you can change the way you socialize or start biking to work instead of paying for a gym membership you rarely use.

Insist on Living Within Your Means

The vast majority of Americans live paycheck to paycheck. In other words, if you’re typically ending the month with any money at all left, you’re in a better position than approximately one quarter of your fellow citizens. Despite what you may think, even many people who earn a nice salary rely on credit cards and other forms of debt to get through each month. If they happen to be confronted with a setback like being laid off, a large medical bill or major car repairs, they have few good options available.

Without question, a major reason many people are stretched so thin is that they’re feeling pressured to follow a lifestyle they really can’t afford. We get it: you want the best for your children, you think that you deserve a little reward for all your hard work, and not a day goes by without your television showing you something you crave to have.

This need can be felt especially keenly in the days after you get your paycheck. Think very carefully, though: you’ll feel much better in the weeks to come if you focus on the essentials first. By all means treat yourself from time to time, but make a point of developing smart, frugal habits.


Which will really give you more joy: buying a pound of steak for $15 at the supermarket and cooking it yourself, or paying twice as much at a restaurant for a much smaller portion? If you enjoy movies, choose online streaming services rather than spending serious money on cinema tickets (plus almost $10 for popcorn). Washing your own car costs nothing, and you may find that you do a better job than the carwash anyway.

Sacrifices like these really will not affect your quality of life all that much. They won’t matter to you at all once you realize how much easier it is to stay solvent until the end of the month, just by giving up a couple of the things you’ve become used to. When you understand how much debt you can get rid of by making good decisions around payday, you’ll wonder why you didn’t start building more deliberate spending habits years ago.

Good Habits on Pay Days Make for Brighter Rainy Days

Small decisions become habits, habits become character, and character determines where you end up in life. Living paycheck to paycheck is stressful, and unlearning the spending patterns that have been with you for your whole life is hard.

It can be done, however, and it’s always easiest to start with the small stuff. If you always join your friends at the bar the Saturday after payday, take a moment to think about whether you really enjoy it that much. If you don’t think you can work with a monthly budget, try setting yourself a spending limit for each week. If the size of your paycheck doesn’t allow you to save $100 per week, try finding $20 – small amounts add up over the years. Try waiting until the end of the month to make optional purchases, as you’ll have a better idea of how much you can afford to spend. If there are some things that bring joy into your life, allocate a set amount for them or see if there are cheaper substitutes available.


Knowing exactly where your money goes each month also allows you to react better if you have a bad month. When you have to make a choice between asking for a deferred payment on your mortgage or putting off paying your electric bill, being familiar with your personal budget will help you keep your priorities straight. Speaking of priorities, unless you’re experiencing an emergency, paying yourself first – investing whatever you can, or paying off debts – should take the first chunk of every paycheck.

Above all, you’ll find that practicing responsible financial habits on payday has non-monetary payoffs. Planning your spending in advance, paying important bills first and doing without a few luxuries will reduce your stress levels considerably. Eventually, once you’ve built up a nest egg, even the prospect of losing your job will be less terrifying and you can start thinking of affording the finer things in life.


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    2 thoughts on “Five Pay Day Habits to Help You Get Ahead Financially

    1. Bob says:

      The “”pay yourself first”” thing is essential.

    2. Jamie Anderson says:

      It’s really parents’ responsibility to teach these habits to their kids, but its never too late to start.

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