Living paycheck to paycheck or having ‘more month than money’ is the absolute norm these days
Oftentimes, people get stuck in this cycle, through no fault of their own.
Bills take over and other financial responsibilities pop up that make it difficult to get ahead of your monthly income.
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Living for payday, or the monthly paycheck does not have to be the ultimate goal.
Unless you are in a real financial crisis then it’s more than likely that there are ways to budget your income and break free from the cycle of living from one paycheck to the other
Difficult tho it may seem, it’s not impossible.
Understanding your money
Is it really worth sitting down and taking a fresh look at your finances?
Well, honestly, that’s completely up to you. The fact that you are reading this post tells me that you are fed up and do want more control over your money.
Money management is something that needs to be learned and if you have not done this before then no doubt it is going to take some time getting used to.
I remember the first time I went over my budget. I really thought I had no money, like my bank balance had a constant zero every single day.
Can you imagine feeling that stressed? I literally felt like I would go bankrupt if I spent a penny. Amazingly, when I finally braved myself to look at the REAL numbers, I had about £400 free to use after paying all of my bills and other expenses!
Imagine my surprise!
That extra money, helped me to pay off my first loan in the space of 4 months after saving a £1,000 emergency fund.
I learned how to get started after a good friend of mine recommended I read Dave Ramseys ‘Total Money Makeover’
Taking responsibility
I have never looked at my finances the same way since reading that book.
I completely understood where I had gone wrong in terms of money decisions, how I had linked my emotions to finances and falllen into the pattern of thinking debt was part of life.
For many, most who don’t actually realise it, they are living paycheck to paycheck purely due to bad money habits.
They are does not mean that you are completely on the breadline, they are just not being careful enough in watching where the coins are going.
I’ve put together some tips to help you get the most out of your money and also inspire you to improve your financial circumstance for a better future
Read on to find out more
Plan for emergencies
This was no such an obvious one for me
For years I lived without an emergency buffer, so when things came up unexpectedly that u had to pay for, if I didn’t have the cash, then I used the credit card.
But that has to be paid for right? So you end up in the ongoing cycle of putting money where it doesn’t need to be.
Make life easier by having a small emergency fund. In his book, Dave Ramsey encourages building an emergency fund if £1,000 and do so as quickly as possible.
What that does for your peace of mind is so amazing I cannot recommend you making this your first goal, but really only after implementing the next step…
Create a budget
For anyone who has not lived by a budget or know how to start one this can seem quite a boring task
But I want to break down the benefits for you as I understand them to be.
Having a budget gives you back control of your money. You decide where your money goes
You get to plan how much goes to savings, paying off debt, having fun, giving to others.
All of these choices however are within your means of course.
Knowing where your money is going once you get that paycheck is amazing. I can’t explain the confidence it gives you. You are no longer living like everyone else, working towards the next paycheck, instead you are planning for the next paycheck
Have a read of my posts to help you get started and also how to stay committed to your budget
Start a side hustle
This is something that is extremely popular these days and for good reason!
Starting a side hustle can add to your income and take the worry out of living on one paycheck
Some research online will show you many examples of others working a day job with another hustle on the side
What could you do?
Are you creative or have an intrrrst that could be sold as a product to people?
If you like teaching or sharing knowledge could you become a coach or a mentor
Could you freelance from what you do in your day job?
Or perhaps like me, you could start a blog! Learn how I set up my blog
Also read my post with some ideas on starting a side business
Find a better paying job or get a second job
Sometimes this is the truth we have to face.
If you have looked at your money and honestly, there is none after your paycheck then you need to find a useful solution
Looking for a higher paid job to alleviate stress of paying bills can help
So you need to train in some new skills or refresh on unused sills? Do this to improve your chances of getting a bigger paycheck
Figure out what you need that will help you feel more comfortable about your finances. I use the site www.salarycalculator.co.uk – there may be a US version if you want to try it. It gives you the take home pay to expect after tax so you can see exactly what is your lowest salary level you would to accept
I highly recommend doing some research on your industry and knowing where you sit in terms of others in your field
Of this is not an option for you then can you consider getting a second job perhaps.
Granted this may not be a good long term solution but if it’s something that can be done for a period of time until your finances are in a place where you can breathe a little more then why not.
It can be anything from evening cleaning to working a part-time weekend job.
Pay yourself first
This concept escaped me for a very long time. Longer than I should have let it
What this means is taking a portion of your money and puttin it aside for savings.
But this isn’t for an emergency fund. It’s for a future use, to use towards something for you. It can be any amount, £5, £10 or £100. The choice is yours and it can vary each month.
Try setting up a separate bank account and have a direct transfer go to that account as soon as you get paid
After sometime of putting money away you may be pleasantly surprised with the results
Learn to say no
I hate letting friends or family down. Especially when it comes to turning down invites for dinners out, holidays even a quick afternoon coffee.
Of course, we all need to have fun with our close people. There might be a point however where our money can’t keep up with the amount of fun we would like to have.
There is no shame is having to turn down an invite here or there. Do you have to use the words ‘I have no money’? Definitely not, however try suggesting an alternative solution that your wallet can handle.
It’s in your best interests to stick to the limits of your money. If anyone pushes you to spend more, quite honestly, that’s not having your best interests in mind
So in conclusion, living paycheck to paycheck is definitely not fun but with some pointers and a change of thinking, there is a way to end the cycle
My key takeaways for you:
- Understand your money
- Have an emergency fun
- Take responsibility
- Plan a budget – learn how to do this here
- Increase tour income with a side hustle or second job
- Pay yourself first
- Learn to say no
Thank you so much for reading, I would love to hear your tips on what has helped you to stop living pay check to pay check and take control of your finances! Share your thoughts and leave a comment below.