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How to Stop Living Paycheck to Paycheck
Monday, April 16, 2018
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Do you live paycheck to paycheck? Would an unexpected $500 bill send you running for a loan? Do you find yourself putting routine expenses on a credit card but only make the minimum payment each month?
If so, there’s probably big financial trouble brewing. Here’s some recommendations that really work to help you get control of your finances.
Make a Budget
Nearly three in five Americans do not have a personal or family budget. So, the first important step is to create one.
Track your expenses for a month and find out where the money is going. This includes outlays for the big items such as rent or mortgage, groceries, and car payments. But it also includes the dollar you gave to the girl selling candy bars for her school.
You may find that in order to balance your budget, you need to cut expenses. After the “necessities of life” are covered, you may find there is not much left for the things you love. But read on, because this article will show you how to live the life you want.
If so, there’s probably big financial trouble brewing. Here’s some recommendations that really work to help you get control of your finances.
Make a Budget
Nearly three in five Americans do not have a personal or family budget. So, the first important step is to create one.
Track your expenses for a month and find out where the money is going. This includes outlays for the big items such as rent or mortgage, groceries, and car payments. But it also includes the dollar you gave to the girl selling candy bars for her school.
You may find that in order to balance your budget, you need to cut expenses. After the “necessities of life” are covered, you may find there is not much left for the things you love. But read on, because this article will show you how to live the life you want.
Increase Your Income
Once you have made a budget, the next thing to do is to see if there are ways you can increase your income. Consider the following:
Keep in mind that increasing your income will not solve all of your budget problems. More than 30 percent of people making six figures report having money troubles according to CareerBuilder. So, make sure you stick to your budget even when you make more money.
Change Your Money Temperature
Consider your attitude about money. Are you spending to compensate for emotional pain or trauma? Find other like-minded people who want to stop living paycheck to paycheck and give each other emotional support.
Pay with Cash
Some people find that they can get their money problems in hand when they switch to cash based transactions. Whenever you have the option, pay with cash instead of plastic.
Some people find the “envelope system” to be a helpful budget system. They take out all of the cash they are going to spend that month and allocate it to envelopes. Then, they only spend what is in the envelope. If you have to eat rice and beans at the end of the month because the grocery envelope is empty, you will be inclined to be more careful at the beginning of the next month.
If there is a particular time of the week or month when it is harder for you to control spending (like weekends), consider our “Withdraw Cash Wednesday” challenge. In this case, you pay only with cash (to avoid building credit card debt). Further, you go to an ATM once a week -- on Wednesdays -- to take out all the cash you will spend for the week. People who embark on this plan find they spend far less on impulse.
Give these tips a try because when you focus on getting your money situation under control, you won’t have to live paycheck to paycheck any longer.
Once you have made a budget, the next thing to do is to see if there are ways you can increase your income. Consider the following:
- Ask for a raise
- Get a better job
- Get a second job
- Start a side hustle
- Get a roommate or rent an extra room on AirBnB
Keep in mind that increasing your income will not solve all of your budget problems. More than 30 percent of people making six figures report having money troubles according to CareerBuilder. So, make sure you stick to your budget even when you make more money.
Change Your Money Temperature
Consider your attitude about money. Are you spending to compensate for emotional pain or trauma? Find other like-minded people who want to stop living paycheck to paycheck and give each other emotional support.
Pay with Cash
Some people find that they can get their money problems in hand when they switch to cash based transactions. Whenever you have the option, pay with cash instead of plastic.
Some people find the “envelope system” to be a helpful budget system. They take out all of the cash they are going to spend that month and allocate it to envelopes. Then, they only spend what is in the envelope. If you have to eat rice and beans at the end of the month because the grocery envelope is empty, you will be inclined to be more careful at the beginning of the next month.
If there is a particular time of the week or month when it is harder for you to control spending (like weekends), consider our “Withdraw Cash Wednesday” challenge. In this case, you pay only with cash (to avoid building credit card debt). Further, you go to an ATM once a week -- on Wednesdays -- to take out all the cash you will spend for the week. People who embark on this plan find they spend far less on impulse.
Give these tips a try because when you focus on getting your money situation under control, you won’t have to live paycheck to paycheck any longer.
Take control of your money and improve your life.
Receive timely reminders and tips to take control of your money by using cash.
Receive timely reminders and tips to take control of your money by using cash.
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