It’s stressful living paycheck to paycheck, and nobody likes living like that. If that’s the case, why can’t people stop living paycheck to paycheck? Everyone can see why a family who makes $25,000 a year lives paycheck to paycheck, but even 25% of families making $150,000 or more live paycheck to paycheck.
Living paycheck-to-paycheck means you must have your next paycheck deposited in the bank before you can spend money. You don’t have any extra in your account, and you cannot save anything or pay off additional debt at the end of the month. You’re stuck and spinning your wheels.
When you’re not living paycheck-to-paycheck, you have enough money to pay for everything without relying on a credit card, payday loans, or other debt. You don’t even need your next paycheck to get by.
In order to save money and pay off your debt quickly, you must stop living paycheck to paycheck. To do that, making more income can help in some situations but reducing your expenses will help in all situations.
In order to get to that point, you need to do a few things. Besides getting on a detailed written plan for the month, you need to stop spending money. You need to change your habits and your lifestyle. You won’t be giving up these things for the rest of your life. Live like no one today so that you can live and give like no one later.
Stop Spending Money
Stop spending money is a no-brainer, right? If it was easy, everyone would do it. Start with a 1-week shopping break. After you get your next paycheck, don’t buy anything for a week after that unless your life is in danger. Don’t even buy groceries. You probably have enough food in your house to last a whole week. Learn how to eat what you have. Repeat this process every month until you can get to where you are grocery shopping once a week.
Stop spending money on non-essentials. Cable, phones, restaurants, and other entertainment need to be cut from your budget. If you have contracts with your cable company, see what it takes to break it. Even if it costs you a few hundred dollars to get out of your contract, look at what it’s costing you each month to stay in it! If you are living paycheck to paycheck, you and your spouse have better things to do with your time than watching TV.
Get Rid of the Credit Cards
When you put all your purchases on a credit card and even if you pay it off at the end of the month, you can do mindless spending. When using a credit card, you don’t have any pain registering with your purchases. There is no thought given when making a purchase, and that causes you to keep making them. One way to help you stop spending your money is to stop using the credit cards and using cash envelopes for budget categories like groceries, clothes, and fun/entertainment.
Know Your Wants
Have a clear distinction between your needs and your wants. In order to stop living paycheck to paycheck, you have to give up your wants for a few months. You need to change some of your habits so that you do not have to spend money on your wants. Certain habits that need to change will not make your life easy. Convenience is a want, and it is part of the problem that’s causing you to live paycheck-to-paycheck.
Get Rid of the Vices
Take inventory of all your vices. Not all these activities are immoral or unethical, but you need to consider giving them up if you want to stop living paycheck to paycheck. Coffee, energy drinks, alcohol, smoking, lotto tickets, overeating, and shopping to name a few. I love my coffee in the morning, and I love my microbrew in the evening! And it’s hard to give up each of them. Assuming you are being responsible* with these things, then see what you can have if you give them up once a week, every other day, or for a couple of months completely. Although it might benefit us to give some of these things up completely, I am only suggesting that you do this for a few months so you can stop living paycheck to paycheck. When you are no longer living paycheck to paycheck, you can decide to add them back into your budget or not.
In order to stop living paycheck to paycheck, you might need to make additional income. Find a good side hustle that you can work 10-20 hours a week. Talk to your boss about working overtime. Making an additional $1,000 a month for a year or two can make a huge difference in your life!
If you are living paycheck to paycheck and do not have a budget, that is your biggest issue. Not knowing where your money is going each month is not how you build wealth. Once you get intentional with your money by having a detailed written plan each month, you can prioritize what you spend money on. You can focus on saving a small emergency fund and getting out of debt.
Stop Worrying What Others Think of You
When you are trying to impress your friends, your family, or your neighbors, it causes you to spend money. Spending money to obtain a certain status is very costly. If you have a budget, this is your second biggest problem, and it doesn’t matter if you have a little money or a lot of money. Status is expensive. It’s most likely that your friends and neighbors don’t even care about your status. It’s only that you think they care, and it’s causing you to live paycheck to paycheck.
Your life can totally change when you’re not living paycheck to paycheck. That stress associated with it goes away. It opens so many possibilities with your financial future. You can start saving and paying off your debt!
*If you are not being responsible with any of these, find the help that you need.