Budgeting In Advance: The Benefits & How To Start

Wednesday, September 4, 2019

For most people, budgeting takes place the day they are paid. They look to the month ahead, and assign their income accordingly. 

However, budgeting further in advance can actually give you greater control over your finances, and can even help to provide an important safety net for the unexpected in life. If you’re curious to find out more, read on… 

What does “budgeting in advance” mean?

Essentially, it’s budgeting for further ahead than the next month. For the most part, it focuses on essential, priority bills; rather than budgeting for these month-by-month, you look to get a head start by, for example, setting aside funds for May’s bills when you are paid in March. 

What are the benefits of doing this? 

The most important benefit is peace of mind. If something changes in your income situation, then you know that not only are your most immediate outgoings covered, but you have a few months before you run down your funds entirely. This is important, as it gives you flexibility when it comes to work. If, for example, the company you work for were to unexpectedly go out of business, you wouldn’t need to immediately dip into your emergency fund to cover your basic outgoings. Instead, your emergency fund could be used for things like groceries and other incidental payments - which should mean that your fund lasts for much longer than it would if it also needed to cover essential bills. 

In addition, budgeting in advance can also ensure you have the freedom within an existing job. If your job is making you unhappy, budgeting in advance can allow you to take much-needed leave, or even look for a new job. If you are experiencing discrimination and have sought to find an example of a law firm who can help you deal with your case, then you can proceed with your case knowing that you have several month’s worth of outgoings in the bank. 

How can you start budgeting in advance? 

  • Establish which of your bills are the most important - your rent/mortgage, utilities, and health insurance are good places to start. You’re budgeting for the true essentials with this method, the things you literally cannot be without. In time you may want to start budgeting in advance for other bills, but start with the basics. 
  • Every pay day, start setting aside funds both for the month ahead (as normal) and for three month’s worth of future bills. To reach this target as quickly as possible, it may be worth making cutbacks to other areas of your monthly budget, such as entertainment. 
  • Bear in mind that you do not need to keep saving so aggressively; this is a short-term measure to establish your “bills fund”. 
  • When you reach this point, continue to top up your bills fund savings every time you are paid. 
  • For example, if your essential bills are $800, then three month’s worth of bills equals $2400. When you have $2400 saved, you can then begin to withdraw from it to pay your bills through the next month. When you are paid, you can then “top up” your savings back to the three-month amount of $2400. 

In conclusion

Budgeting in advance can really help to stabilize your financial future and ensure that your most crucial needs will be met if there is a sudden change in your circumstances, so if you can, it’s definitely worth giving the idea a try.


  1. This was a really helpful post. Will certainly start my long term budget asap. Thanks for this.

  2. Your advices are very important ! Especially when you have a family and you can't afford to have no more money. There is so many Unexpected events in this life (Accident, car down, illness, etc ...) I'm in Finance and I know the imporance of budgeting in advance ! But people often love the extremes : Either they do not save money or they save at one time


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