Broke on Tuesday: my weekly money plan

A follower named Peggy wrote and asked what financial template I recommend. Fair question, and my honest first answer was: Peggy, I need more data. But behind it sits the system I have used my whole adult life, so let me lay it out.

I do what we call financial planning every week. Personally, as an individual, and across the companies I have around the world, every single one of them, every seven days. Fifty-two times a year, we do it, and we do it again, and we do it again. It never stops, and that is exactly why it works.

Software is not a plan

People ask about templates and software. We use different bookkeeping systems in different countries, and they are fine tools. But understand what they are: data entry goes in, a summary comes out. A bookkeeping system is not a financial plan. It just tells you what happened.

The plan starts when you export that weekly report and sit down with it. Step one: know where every bit of the money came from. Complete knowledge. Not roughly, not mostly. I can tell you where all of it came from every week, and that knowledge alone puts you ahead of almost everybody.

Allocate before you spend

Step two is allocation, and here is the heart of the whole system. Say your rent is a thousand a month, just play pretend. Every week that goes by, a quarter of that rent is owed to the future. So if a check comes in this week, the first piece of it goes to rent. It is not my money. It is the landlord's money, sitting in my account waiting for the bill.

I do this with every one of my major stable bills: a quarter of each, every week, so that when the bill arrives, the money is already sitting there. No scramble, no surprise, no borrowing from next month to patch this one.

Then whatever is left over, I get to dial out where I want it to go. And I allocate that too, down to the last bit: set-asides, purchases I have decided on, things I want. I put purchase orders against it. By the time I am done, I know where every penny went and where every penny is going. It has all been spent, on paper, on purpose.

Why broke on Tuesday is the goal

Here is my week. The money lands on the weekend. On Tuesday the accounting data comes in from the people who prepare it. And no matter how much money I made the week before, I am broke on Tuesday, because I have allocated all of it. Every penny, spent logically and intelligently, committed to something.

That is why I never look at the checkbook balance. I never put my card in the ATM to see how much money I have, because it is not mine. I spent it already. I committed it.

And this, honestly, is how I stay hungry. I look at the plan and go: I do not have enough money. So I go make more, and the next Tuesday I am broke again, and the machine keeps turning.

Understand that this same system runs identically at every scale. I do it for myself as an individual, and it is done every week in companies of mine on both sides of the ocean, on different bookkeeping software in different countries, and the plan on top of the report is always the same three moves. Where did it come from. What is it committed to. What does the leftover serve.

So do it every seven days, fifty-two times a year, and do not skip a week, because the power is in the rhythm. Know where it came from, commit where it goes, pay the quarter-bills forward, and let the leftover serve your goals instead of your moods. That is the template, Peggy. It works at any size.