Thursday 5 April 2018

The Average and The Long

So, payday is this Saturday, but as sometimes it happens, I have my paycheque in my hand early. 

I can’t cash it (legally, morally or ethically) but it at least lets me finalize my budget. 

As some of you know I have a spreadsheet attached to my timesheet, that lets me estimate what my paycheque will be. (I used to call this tab the “Will I Make Rent” tab.)

On there I just calculate out my Gross Pay: (Hours Worked X Hourly Rate) + the sum of Daily Commission on Online Sales.

Of course we don’t get paid our Gross Pay, but our Take Home Pay. I calculate out my take home pay by lopping off a certain percentage. 

At the start of the year I take off 27.5% yet in the last two months of the year this is closer to 18 – 20%. 

This is because the government takes off more at the beginning of the year than at the end (they want their money quicker . . . go figure).

From experience I can guess what the accurate (or closest to real) percentage that will be. 

I like to take off more than realistic in my estimations, so my projected pay will be less than it most likely will be.

I do this so that: 

1) I will not be shocked when/if my actual paycheque is lower than my expectations.
2) My actual paycheque is a little bit higher than I had estimated, so each payday I get to figure out what to do with “Extra Cash.” (It feels like Christmas each payday).

This payday my cheque was higher than expected, it was a good payperiod. So much so that I was able to put my entire “Budgetary Minimum” into savings and fund my expenses with the cash that was over my Budgetary Minimum.

What is my Budgetary Minimum? That is a budgetary holdover from five years ago, as that number was the minimum amount I needed to bring home to pay my bills and exist.

Since I have worked so hard at eliminating my debts and monthly bills, that actual number is around 10% of my take home pay. 

I keep that number there, as I insist that I pay myself what I have been paying my previous debtors. I have a massive debt that I owe myself, and goals and dreams to accomplish.

The interesting thing is that I must contrast the wonderfully overflowing paycheque that I have in hand with the drastically short one that is coming. 

My next paycheque looks to fall short of my Budgetary Minimum by around the same amount that this one overflowed. 

I will still do what I can to make my Budgetary Minimum (I still have till then end of next week on that paycheque’s payperiod) but in reality it is beyond my control.

I say this all because when looking at these higher than average paycheques and these lower than average paycheques, one must keep in mind the Average and the Long.

The Average is just that over the Long Term, these two extremes will balance out. Make hay (or savings) when you can, for there will be times when you can’t. 

Keep in mind that there will be large and small paycheques for a variety of reasons. All you can do is do the best you can with this paycheque in hand. Things will work out in the end.

As always: Keep your head up, your attitude positive and keep moving forward!

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