Advertiser Disclosure

Strategies to Save

11 Tips for Budgeting Monthly Bills on a Weekly Paycheck

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

While Chelsea Jackson finished her Early Childhood Education degree at Georgia Gwinnett College in 2016, she took a job as a cashier at a local grocery store. The 23-year-old earned $9.25 an hour and was paid on a weekly basis, bringing in about $250 with each paycheck.

Getting paid on a weekly basis, she says, came with its own set of challenges. She needed to figure out how to save enough from each paycheck to cover bills due later in the month while also meeting her immediate needs (food, gas, etc.) at the same time.

“When you get paid weekly you don’t really have a snapshot of what your true income is because it’s gone so fast,” says Jackson, who now works as a first grade teacher. “It’s such a little amount, you really don’t see how much you make until the end of the month when you add up your paychecks.”

More than 30% of U.S. businesses pay workers on a weekly basis, according to the U.S. Bureau of Labor Statistics. Cashing a paycheck every week might sound like a great deal, but it can actually make budgeting for bills more challenging.

Exacerbating matters is the fact that workers who are paid weekly are already at a financial disadvantage, as they are more likely to earn less than their counterparts who are paid biweekly or monthly. Employees on weekly pay schedules earn an average of $18.62 per hour versus $24.81 (workers paid biweekly) and $28.45 (workers paid monthly), according to the BLS.

There are ways to adjust to a weekly pay schedule and still meet your financial obligations at the same time.

Here are some tips:

Change your bill due dates if you can

If you can, ask whatever entity is sending you a bill each month if you can move your due date to one that’s more convenient for your budgeting purposes.

“You kind of have to have one thing pushed back so it doesn’t hit you all at once,” says Shannon Arthur, 22, who receives a weekly paycheck as the assistant manager for a department store in Suwanee, Ga.

Arthur says her credit card bill comes during the second week on purpose. She called her credit card company to change the bill’s due date to better fit her payment schedule.

Work with your lenders when you can’t meet your due dates

If two bills overlap and there isn’t enough money in the bank for both, workers are left with a hard choice. Arthur found herself in that situation, and she knew she was going to be late paying her phone bill. She found that honesty worked in her favor.

“I just explained to [T-mobile] my situation,” she says. They allowed her to pay $20 of the bill that week, then pay the remainder the following week.

But she stresses making a good-faith effort to pay your bill on time if you’re going to ask for extra time as you’ll likely need to show you have a good payment history or the company may not allow you to pay later.

Save your “extra” check

When you’re paid weekly, you’ll have some months when you’ll receive five paychecks instead of four. “Those months should be used strategically,” says behavioral economist Richard Thaler.

He advises workers to budget based on receiving four paychecks each month and then use the fifth, or “extra” paycheck to boost or address your financial goals.

“When it comes around, or if, perish the thought, there are outstanding credit card bills, pay them down,” says Thaler.

Chart your cash flow

Know exactly what money you have coming in and how much you have going out each month. Lauren J. Bauer, a financial adviser based in Greensboro, N.C., recommends creating a list of all of your bills. From there, calculate how much you need to withhold from each paycheck in order to cover those bills by their due date.

“It makes it easier than just writing down a total for all your bills and trying to get them paid when you think about it,” says Bauer. She says the chart makes it easy to see what you’ll spend by check, so that you know how much money you’ll have coming in and what you’re able to pay for that week.

Set aside money to cover bills in advance

“If you’re getting paid weekly, you need to develop a discipline to save for things that you pay for on a monthly basis,” says Peter Credon, a New York, N.Y.-based financial planner.

Jackson says she relied on a simple strategy to make sure her bills were paid on time. She strove to save up three months’ worth of expenses. Once her savings fund goal was met, rather than paying her bills with a bit of each paycheck, she used her savings to pay bills as they came. Then, she replenished some of the funds each time she was paid.

This strategy is all about taking back control of your budget.

“If you have enough money [set aside], you can prefund things in many aspects and have control,” Credon says. “You’re controlling your finances and how you spend your money.”

Set aside funds for emergency expenses

No matter how often you’re paid, you should build an emergency fund that holds enough money to cover about three to six months’ worth of your fixed expenses. It can help cover irregular or unexpected bills that don’t line up with your pay schedule, like an emergency dentist visit or a trip to the auto shop.

“The emergency fund helps keep you out of long-term debt,” says Credon. “Focus on building up a little more cash on the side to get yourself through the tougher times. He says you may even want to save a little more if you’re a shift worker and your hours fluctuate.

Keep your spending money in a separate account

An easy self-hack that helps combat overspending is to transfer funds you need to cover your expenses for the month to a designated checking account and restrict yourself to using only those funds each month. Automatically transfer the amount you wish to save to a separate savings account, so you’ll be less likely to spend it.

Putting the extra money in savings can help prevent you from getting used to a larger budget. It stops you from seeing you have more money in your budget for the next week and thinking you can overspend. You take that money out of the equation to keep your spending habits tamed.

Make partial bill payments with every paycheck

If you know the date and amount of an upcoming bill, you can get ready for the payment ahead of time to lessen your financial burden during the week when the bill arrives.

For example, let’s say your rent payment is $700 per month, but you receive only $400 per week. Each week, set aside $175 for your rent and reserve the leftover funds for other expenses.

This way, a large, recurring bill like a mortgage or student loan payment won’t eat up the majority of your paycheck the week the bill becomes due. Plus, you’ll already know you have the money to cover the bill.

Try not to splurge

When you’re paid weekly, you’re paid quite frequently, so it can be easy to feel like your next payday is right around the corner. But you may run out of money faster than you imagine. When Jackson was paid weekly, she was forced to be strict with herself because she wasn’t paid that much at a time.

“There were definitely weeks or months when I would splurge,” says Jackson. “Those six days [till the next paycheck] can feel like a really long time.”

Use apps to track your spending and saving

You can set bill reminders on your banking or budgeting applications to remind you when a bill will be due in the coming week or set alerts to let you know when you’re overspending in a category you’ve budgeted a limit for.

Jackson says she used the budgeting app Mint to reign in her spending on food since she realized she was overspending at the grocery store.

Don’t forget to check your credit report from time to time if you use credit cards or have loans you’re paying off. “If you’re paying your bills on time and promptly, you’re also building your credit score,” says Credon.

Keep your goals in mind

Admittedly, if you’re already struggling to live paycheck-to-paycheck, saving up can be tough, but it’s not impossible.

“Watching a budget isn’t fun because most people want to be able to do what they want when they want to,” adds Credon. He suggests building in some rewards — like getting to go on a date night once a month — to help stay on course. He says to think of longer-term goals to keep you going, like the ability to buy your own place or take a trip for a few weeks overseas.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Brittney Laryea
Brittney Laryea |

Brittney Laryea is a writer at MagnifyMoney. You can email Brittney at [email protected]

Advertiser Disclosure

Strategies to Save

Understanding the Various Types of Deposit Accounts

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

A deposit account is an account at a bank or credit union that allows you to safely and easily manage your money. Deposit accounts fall into two major categories: demand deposits and time deposits.

Demand deposit accounts, which include checking and savings accounts, may let you withdraw up to the full amount of your savings at any time without gaining permission from the bank or credit union. Time deposits, like CDs, restrict your access to funds for a set time period.

What are the types of deposit accounts?

The two key features of deposit accounts

All deposit accounts offer two primary features: security and interest.

Security

When deposited into an insured financial institution, your money is protected in the event of bank failure up to the legal amount per account by the Federal Deposit Insurance Corporation (FDIC), or up to the legal amount per credit union account by the National Credit Union Administration (NCUA). Joint accounts with two account owners get double the protection from the FDIC or NCUA. You can find out if the bank you’re considering is insured by the FDIC here.

Interest

You’re not just putting money into a deposit account to keep the funds safe — you also want to be rewarded for letting the bank hold your money. After all, banks and credit unions use funds held in deposit accounts to make loans to other customers, and earn profits. Interest payments is how banks and credit unions reward their deposit account customers, and incentivize them to keep funds in their accounts.

The longer you leave your money and earn interest in the bank, the greater the interest the account will earn. This is called “compound interest.” Depending on the bank and the account, interest may compound on a quarterly, monthly, weekly or daily basis. The more often interest compounds, the faster your balance grows.

When comparing prospective deposit accounts, you’ll want to review the annual percentage yields (APY). The APY advertised by your bank or credit union is the amount of interest you’ll earn in one year — the APY factors in the interest rate on the account as well as how often it compounds, so comparing APYs is the best way to compare the earning potential of different accounts.

Features of the main types of deposit accounts

These are the five main kinds of deposit accounts — let’s take a look at how they work and when you need them.

Checking accounts

Checking accounts are demand deposit accounts that let you deposit or withdraw money whenever you want. A checking account provides easy access to your money via paper check, ACH transfer, debit card, or cash withdrawal at a branch or ATM.

Some checking accounts pay interest, with our list of best accounts available paying upwards of 4.00% APY or more, as long as minimum balance requirements are maintained. But note that many checking accounts pay minimal or even zero interest, and regulations do not require institutions to offer interest payments on checking accounts.

Checking accounts may charge fees, including monthly maintenance charges; however, fees may be waived if you maintain a minimum balance or set up recurring direct deposits. You can be charged for money orders or cashier’s checks, and there may be limits on the amount you can withdraw in a given day or per ATM visit. Writing checks or swiping your debit card for amounts you don’t have can result in costly penalties like overdraft fees, insufficient-funds fees, or returned-check fees.

When to open a checking account

  • Checking accounts are one of your most important personal finance tools. This is where you manage the money you earn and spend on a day-to-day, week-to-week basis.
  • If you’re earning a low APY or earning no APY on your checking account, now might be the right time to examine your options. There are plenty of high-yield checking accounts available on the market today.
  • Look for checking account with zero fees. There are simply too many zero-fee options for you to be paying monthly account fees for your checking account.

Savings accounts

Savings accounts are demand deposit accounts that offer interest on your balance. Interest may be compounded daily, weekly, monthly, or annually. The benefits of savings accounts can vary widely based on requirements for a minimum opening deposit, monthly service fees, interest rates, and how the interest is calculated.

Savings accounts aren’t meant to offer the ease and frequency of access you get with checking accounts, but some do offer debit cards and even checkbooks. The Federal Reserve’s Regulation D mandates certain types of telephone and electronic withdrawals, including transfers from savings accounts up to 6 per statement cycle. If you exceed your transaction limit, the bank may charge you a fee, close your account or convert it to a checking account, so check with your bank about requirements and penalties.

When to open a savings account

  • You may want to look into moving your savings into a high-yield savings account if you can get a better rate than what you’re earning with your current savings account.
  • When considering a new savings account, look for the highest possible APY you can find — most often, that means looking at our list of online savings accounts, which we have found consistently offer the best rates in the business.
  • Skip accounts with any monthly maintenance fees, as they eat into your returns. Also keep an eye on minimum balances to earn the highest possible APY.

Money market accounts

A money market account (MMA) is a high-yield deposit account that offers interest rates very similar to those offered by savings accounts. Money market accounts often provide access to your funds via debit cards or checks. However, like savings accounts, they too are subject to Regulation D which mandates certain types of telephone and electronic withdrawals, including transfers from savings accounts up to 6 per statement cycle. You should check with your credit union or about any transaction limits and potential penalties. Minimum deposit requirements for MMAs are frequently higher than those for savings accounts.

When to open a money market account

  • Money market accounts have many of the same benefits and restrictions as savings accounts. MMAs generally require higher minimum deposits to open than savings accounts, and in exchange for that, you may be able to secure a higher APY. If you have a large sum you wish to keep as a liquid asset, a money market account may be your best option.
  • If you need easy access to your funds, a debit card or even a checkbook can be reasons to choose an MMA — although many savings accounts offer these conveniences as well.
  • Like with savings accounts, you need to understand the minimum balance required to earn the account’s highest advertised APY.

Certificates of deposit

Certificates of deposit (CDs) offer a way to earn higher rates of interest than those offered on savings accounts. CDs are time deposits, with common terms between one month and ten years. With a CD, you cannot withdraw money before the CD matures without incurring a penalty.

Penalty rates vary across the industry and by CD term length, but penalties generally amount to losing some or most of the interest you’ve earned on your investment at the time you withdraw. The interest rates are fixed over the term of the CD. The CD may automatically renew upon the maturity of the original deposit, so check with your bank or credit union for details.

CDs are insured by participating institutions up to the legal amount per account, per institution by the FDIC for banks and the NCUA for credit unions. Larger principal deposits and longer terms may fetch more competitive rates, although investors need to be sure they are comfortable losing access to their money for long durations.

You can stagger multiple CD maturity dates to create a CD ladder as a way of maintaining liquidity, capitalizing on increasing rates, and hedging against falling rates.

When to open a certificate of deposit

  • CDs are only a good option if you don’t need access to your money for whatever term you choose — either a short-term certificate with a term numbered in months, or a long-term CD lasting years.
  • Some CDs offer higher interest rates than savings accounts. Again, though, you must be prepared to leave your funds untouched for the term of the CD. Beware of high penalties for early withdrawals, before the end of the CD’s term.
  • Locking your money up in CDs could be a good strategy when market interest rates are falling: You can maintain a higher APY while other deposit accounts see declining rates. Conversely, they might not be the best choice when market rates are rising: By locking in a CD, you might miss out on higher APYs on other deposit accounts from higher rates.

Individual retirement account CDs

Individual retirement accounts (IRAs) are tax-advantaged vehicles designed to help people save for retirement. With an IRA CD, you may use funds saved in your IRA to invest in designated CD products. Credit unions, banks and brokerage firms offer IRA CDs, available as either traditional IRAs or Roth IRAs.

IRA CDs share most characteristics with regular CDs. IRA CDs may renew automatically like traditional CDs, so it’s important to keep track of your CD maturity dates so you can make educated investment decisions when the CD term ends. Keep in mind that deposits into an IRA account are subject to annual IRA contribution limits.

Like regular CDs, IRA CD investors need to beware of early-withdrawal penalties. Not only are there penalties for withdrawing from the CD before it matures, but if you remove the funds from your IRA, there is an IRS tax penalty of 10% on any distribution you take before you reach 59½ years of age. Still, the IRS may waive early distribution penalties for certain situations, such as a withdrawal of funds applied to a first-time home purchase.

When to open an IRA CD

  • IRA CDs are a great option for conservative retirement investors who want a decent rate of interest, without exposure to volatile stock or bond markets. 
  • Unlike stock and bond investments in IRAs, IRA CDs are insured by the FDIC and NCUA up to the legal amount per account, per institution.
  • Like standard CDs, IRA CDS prevent you from accessing principle for whatever term you choose.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Yolander Prinzel
Yolander Prinzel |

Yolander Prinzel is a writer at MagnifyMoney. You can email Yolander here

Advertiser Disclosure

Strategies to Save

Fresh EBT App Review

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

The government distributes Supplemental Nutrition Assistance Program (SNAP) benefits — also known as food stamps — via Electronic Balance Transfer (EBT) cards. The Fresh EBT app allows recipients of SNAP benefits to use a smartphone to check the balance on their EBT card. The Fresh EBT app has more than 2 million users and works with food stamp programs in every state.

What is the Fresh EBT app?

Until recently, people who receive SNAP benefits could only check their monthly benefit balance by calling a hotline — or keep a running tally of their grocery store receipts. More than 42 million people receive SNAP benefits, and 26% of low-income Americans rely on cell phones as their main internet connection.

In 2015, software startup Propel launched the Fresh EBT app, providing a quick and easy way for people who receive SNAP benefits to check their EBT balance. Users can also check their benefits from other federal programs, like Temporary Assistance for Needy Families. The free app is available for both iOS and Android and can be downloaded from the iTunes app store and the Google Play site.

Fresh EBT lets people keep up with the benefits available to them and also lets them see what they’ve purchased and where they bought it. The app also shows nearby stores and farmer’s markets that accept food stamps — although it doesn’t indicate which items are eligible to be purchased with funds from federal assistance programs.

How Fresh EBT works

The Fresh EBT app is linked to a user’s card via their state of residence’s EBT portal. Every time someone uses the card at a grocery store or farmer’s market, the total adjusts and users can check their remaining balance on the app.

When you log in, you’ll see a “recommended weekly budget” right underneath your EBT balance. This can help you plan your monthly EBT balance ahead of time, so that you don’t run out of money before the month is over. If you stick to this number each week, you’ll have enough EBT money to buy food for the whole month.

Other Fresh EBT features include free affordable and nutritious recipes and digital coupons you can use to make your EBT dollars stretch even further. Plus, as the average monthly SNAP benefit for one person is $134, Propel has partnerships with local and national nonprofits like Feeding America and Double Up Food Bucks to help people who find their SNAP benefits aren’t enough to get them through the month.

The app also shows the locations of nearby food pantries, offers coupons for participating retailers — users have accessed close to $15 million in savings so far — and provides access to healthy and inexpensive recipes.

The Fresh EBT app even touts that it offers job postings. You can see a list of jobs available in your area, along with a link that’ll take you to that job posting’s webpage. From there, you can get more information about the job and even apply directly for it.

How to sign up for Fresh EBT app

To use the Fresh EBT app, you must provide sensitive personal information like your Social Security number, although Propel reports that the information is encrypted. You also will need to have your EBT card number and PIN handy when you sign up. However, Propel notes that it does not store EBT card numbers or PINs on their servers, for extra security.

Although the Fresh EBT app is available to all U.S. states and territories, there have been problems in the past for some users who live in one of the 25 states where the food stamp program is managed by the government contractor Conduent.

Some users in these states reported that their balance data was unavailable for large stretches. And while Conduent does offer its own balance checking app, ConnectEBT, it’s only available in seven states on the Google Play store — Arkansas, Maryland, Maine, Oklahoma, South Carolina, Tennessee, and Utah. If you’re using an iPhone or iPad it’s even worse: the app is only available in three states: Oklahoma, South Carolina, and Utah. But while people can always check their balances through the hotline if they have any Fresh EBT app troubles, it’s also a good idea to hang on to grocery receipts as a backup.

Pros and cons of Fresh EBT

Among the common complaints about the Fresh EBT app are discussions about difficulties in connecting, or getting locked out of an account and having trouble signing back in. Positive reviews note the ease and speed of the app in comparison to calling the hotline to check a balance. Many users also like the coupons, the ability to see past purchases, and the recipes.

Pros of Fresh EBT

  • Provides a great way to check updated food stamp benefit balances: You can see your balance instantly, without having to call up the EBT hotline or finding your balance at the bottom of the receipt from your last food purchase.
  • Maps nearby food pantries and stores that accept food stamps: You can search on a map to see nearby stores and farmer’s markets where you can use your food stamp benefits. You can also find nearby food pantries, food stamp offices, and WIC clinics.
  • Offers digital coupons: You can download coupons for specific food items at specific stores right through the app. This can also help you make the most of your EBT benefits.
  • Special offers: In the “All Offers” section of the app, you can find other helpful money-saving resources for lower-income families. For example, you can get more information about discounted Amazon Prime membership, or access to lower-cost cell phone services.
  • Available in every state, with versions in English or Spanish: No matter which of these languages you speak — you can use Fresh EBT. And unlike some other EBT balance-checking apps, Fresh EBT is available no matter which state you live in.

Cons of Fresh EBT

  • Can have some bugs and loading issues: Since each state manages its own EBT program, there are a lot of different technologies that the Fresh EBT app has to navigate. Sometimes that can cause some difficulties with the app. For example, Conduent is a company that manages EBT benefit information in many states and it’s had some troubles in keeping up with Fresh EBT, causing some users to not see their current balance in the app for a period of time.
  • Does not provide a list of items that can be purchased with food stamps: The app can tell you which stores allow you to use your EBT benefits, but it isn’t able to tell you how much items cost there. Some stores can charge a higher price than others.

Who should use Fresh EBT?

Anyone who regularly uses SNAP food stamp benefits through an EBT card, owns a smartphone and wants an easy way to keep track of their benefits will likely find the Fresh EBT app useful.

The app saves you money by offering coupons and directing users to stores offering specials. The app is also a one-stop shop for other information about early childhood education programs, local doctors, mental/health substance abuse programs, heating assistance and more.

All told, the Fresh EBT app is an efficient and data-driven way for people to get the most out of their SNAP benefits.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lindsay VanSomeren
Lindsay VanSomeren |

Lindsay VanSomeren is a writer at MagnifyMoney. You can email Lindsay here