Break Free of Living Paycheck to Paycheck
Are you tired of living paycheck to paycheck? You’re not alone. Many people, even if we earn good money, are stuck in that never-ending cycle of earning and paying bills with nothing to show for it at the end of the month. Our savings accounts sit idle and we’re afraid we won’t ever reach our goals. There is a way out if you’re committed to the process. It’s possible to build a financial cushion, save for emergencies, achieve your goals, and eliminate your financial stress.
Gain financial freedom by taking control of your finances:
1. Get excited. If you’ve been living paycheck to paycheck, it’s most likely been going on for a while. Why is it still happening? Make a list of the advantages of getting out of this cycle. Pay special attention to how you would feel.
· You would be able to handle any financial emergencies, such as a broken furnace or the medical emergency for your pet.
· You’d sleep better.
· You could take a nice vacation.
· What else can you think of?
2. Pay yourself first. It’s difficult to save any money if you don’t make paying yourself a priority. Consider your savings account to be a monthly bill that must be paid regardless of the circumstances. It’s not the last bill. It’s the first. No exceptions. And make it automatic.
3. Get a handle on your spending. Everyone should have a monthly spending budget. Do you? In addition:
· Don’t use credit cards for spending unless you have pre-funded the purchase and can pay it off immediately. Statistics also show that we spend more when using a credit card than we otherwise would if paying by another method.
· Avoid making big purchases without a waiting period. The urge to spend a lot of money will often pass after a couple of days.
· Create a decision-making process before purchasing anything you don’t need. This can be as simple as asking yourself a couple of questions: 1. Do I need this? 2. Is this helping or hurting the goals I want to accomplish? Then remind yourself how great you’ll feel when you spend intentionally rather than on impulse.
· Eliminate unnecessary expenses. If it doesn’t help to keep you alive or employed, consider redirecting that money to the things that are important to you like a vacation or saving for a new car, as well as funding a monthly budgeted amount to a spending account for spending on the things that truly bring you joy.
· Make sure that you have a budgeted a set monthly amount for spending, and that your spending account is separate from your other accounts. Attach a debit card to this account. When the money is gone, it’s gone, which removes the risk of overspending.
4. Earn more. Sometimes there’s a limit to how much you can cut your expenses, but there’s no limit on how much you can earn. Most financial gurus only focus on the expense side of the equation, but your options are ultimately limited. If you’ve been in your current position for at least two years, apply for something more lucrative.
Find a way to earn some money on the side. There are also ways to earn extra money without leaving home on the internet. Get creative. Dog walk, babysit, run errands for people.
5. Be patient. It’s easy not to feel excited if you’re only saving $100 each month, but it’s a start. You are moving in the right direction. There’s a lot of inertia in your personal finances. It will take time. It’s important to recognize and celebrate your progress, no matter how small.
It’s easy to get stuck in a cycle of living paycheck to paycheck. Even if you have a well-paying job. It’s important to address the problem sooner rather than later, since for some people, just a couple of weeks without a paycheck would spell disaster.
Though it seems like a long journey to break free of this cycle, it’s worth the time and effort. Not worrying about your bills or what the future may hold will remove the financial stress from your life.