How To Stop Living Paycheck To Paycheck: An Actionable Guide
You’re strapped for cash. Your bank statement’s bottom line is barely hovering above zero, and you’re sick and tired of living paycheck to paycheck. Yeah, it’s nauseatingly stressful—that’s to be expected. Even a small, $500 emergency, is more than enough to force you through the doors of some makeshift title-loan company reluctantly adding another heaping scoop of debt to your stack of debts.
But what’s worse is the torment of making *zero* financial progress! You’ve been stuck in a rut, seeing no money growth for years. And the visceral frustration from this continues to compound with each day you spend at your job earning money you can’t even afford to spend.
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But here’s some good news: an ever-growing savings and $0.00 in debt—these seemingly huge financial goals are very attainable once you *know how* to accomplish them. And it doesn’t have to be hard.
Step one for how to stop living paycheck to paycheck: read this article. It has everything you need.
Do I have an income problem or a spending problem?
Want to treat a problem? Any problem? You’ve got to diagnose what’s causing the problem first. What is it that’s causing you to live paycheck to paycheck? Is it because you spend too much money? Or is it because you earn too little? There’s only one way to find out.
Figure out where your money is going every month. Write down how much you earn on a monthly basis. Then, list your expenses. How much do you pay in mortgage/rent? How much do you spend on groceries every month? What does your internet, cell phone, Netflix, Hulu all cost you every month. Write down every expense, then do [income-expenses].
I’ll tell you what… When *most* perform this exercise, they feel like all of the sudden they’ve just received a massive raise. Their monthly expenses aren’t as costly as they had thought, and they immediately realize they should NOT be struggling with money.
But where’s the money going? Generally, it’s those small, meaningless $5 expenses (Starbucks, small online purchases, renting a movie) that are draining your bank account. Those little “cheap” $5 expenses are the culprit for causing millions to suffer the miserable existence of living paycheck to paycheck.
But don’t mishear me. You DO NOT have to give up your Starbucks, online shopping, or movies in order to stop living paycheck to paycheck. The way to stop living paycheck to paycheck is to spend your money the right way.
Reduce the Expense You Loath Most… Your Debt
You must pay back your debts, but as for interest payments, those are negotiable. If you have multiple debts, consolidate them: combine all of your debts into one debt, and get at a lower interest rate (spend less on interest). Your monthly debt payments will lower, and you’ll get out of debt just as fast.
Stop overspending on interest. Choose a competitive credit card debt-consolidation loan from Fiona. You’ll get matched with loan offers up to $100,000, with loan terms of 24-84 months, and APR ranges from 3.84% – 35.99% (based on creditworthiness).
Start spending your money the right way
Alright, now that you’ve laid out your finances, it’s become glaringly apparent that you’ve got a whole lot more money than you thought you did. Now it’s time to use that money to build your savings and pay down debt! But how do you do this? Well… you gotta start spending your money the right way.
In other words, you have to keep your income over your expenses. *You can do that!*
The fastest, easiest way to make this happen? Start budgeting. Track your income; track your expenses. Pay attention to how you’re spending your money, and don’t spend more than you earn.
Do whatever it takes to make this happen. Switch to a cash-based system if you need to (you can’t spend more cash than you physically have which means you must spend less than you earn). Cut up your credit cards if you’ve got a credit card problem. Eliminate some unnecessary expenses if need be. Do what you need to do keep your income over your expenses, and you will succeed.
Want some help organizing your money for free? Get the free Charlie App, the money saving penguin!
Charlie is a free app that helps you track your spending on groceries, utilities, subscriptions, gas, and everything else you don’t have time to track yourself.
This simple service is the easiest way to keep your income over your expenses (aka saving you money on autopilot). In fact, Charlie users save an average of $80/week!
Want to see if you’re above average?
Watch your money grow
Spend less than you earn, and your wealth must grow—it makes sense. By definition, you are no longer living paycheck to paycheck!
When you learn to spend your money the right way, it will only be a matter of time before you get to experience the peace and security that comes with having $20K plus in savings. What’s more, you will never take on another dime in debt! (You’re spending less than you earn.) Every month, your debt has no choice but to steadily decrease down to $0.00.
A budget is your solution to finally see some serious progress with your money. Every year, you will have more money than you did the last—not because you made huge life changes or decided to spend as little money as possible, but rather because you figured out how to spend your money the right way. You monitored your money and spent it responsibly. You kept your income over your expenses and let your money grow naturally.
Make the decision to stop living the paycheck to paycheck lifestyle today because you have enough money not to. It’s too stressful of a lifestyle, and, most of all, you deserve to enjoy your money. Start spending your money the right way, keep your income over your expenses, and watch all the pieces to a successful money lifestyle fall perfectly into place.
I wish you all the luck moving forward. Stay proactive, keep getting the money education you need, and I have no doubts you’ll succeed.
- How To Live Frugally On One Income– 40+ Money Saving Tips (that work)
- How to Budget – Your Step-by-Step Guide
- Why Am I Broke– Plus 35 Tips To Fix It
- How to Lower Your Bills (for good)