Are you living paycheck to paycheck? Tired of it? Looking for a new way to handle your money so that you aren’t anxiously waiting for your next direct deposit? Here are some simple steps to follow that will ensure you’ll stop living paycheck to paycheck – and never go back. The Problem with Living Paycheck to Paycheck Living paycheck to paycheck is a problem because emergencies happen in life. If you live on the brink of financial collapse, even the smallest of emergencies can knock you off balance and cause you to miss a mortgage payment, car payment, or utility bill. Just imagine what a large emergency might result in . . . complete destruction! Okay, you’ll probably survive, I’m just saying . . . . Some of you out there might not see much of a problem with living paycheck to paycheck. You think it’d be nice if you could live otherwise, but you feel that someone in your circumstances doesn’t have a choice. I’m here to tell you that you do have a choice , and the best choice you could make is to follow the steps below. How to Stop Living Paycheck to Paycheck Make a budget now! “Oh no, not that!” Yes, that . It’s time you started a budget. Many people living paycheck to paycheck don’t have a budget in place, so that’s the first place to start. Bob has written an excellent post on how to make a budget . In it, you’ll learn a couple budgeting methods that will put you on the right track. Pick the method that’s right for you, and follow it! Spend this month’s income next month. This is where you can truly stop living paycheck to paycheck. For those of you who are paid at least once a month (most of us), this is one of the best rules you could follow. Here’s how it works. Let’s say you get paid twice in January, $1,500 each time. So for the month of January, you have $3,000 of income. That $3,000 wouldn’t be spent until February, at which point you would allocate that money down your prioritized budgeting categories. So how do you live in January if you’re going to spend January’s income in February? One of two ways: You can use savings from another account to add $3,000 into your January budget or you will have to of saved money in the months previous to January (by living on significantly less money than your income) to live on in January. As you can see, spending this month’s income next month can take some time to get started. The next few ideas will give you some ways to create wiggle room in your budget. Stop adding new debt. One reason people live paycheck to paycheck is because they are spending more than they make or just as much as they make. Credit cards, personal loans, and other forms of debt add interest payments to whatever you’re buying, making it even more difficult for you to stop living paycheck to paycheck. Instead of accepting the risk of going into more debt with a high interest credit card, try a cash back debit card instead. You won’t go into debt with a debit card, and you can still earn lots of rewards! Lower your expenses. Marketing is at an all time high, and often compels us to sign up for services we either don’t need or are way too expensive. Find ways you can lower your expenses, and ask yourself probing questions such as: How much do you pay for your cable bill? Why not try a low-cost Netflix subscription instead? How much do you pay for your iPhone, Android, or Blackberry smartphone? Why not learn how to lower your cell phone bill ? There are many expenses you could reduce or eliminate if you put your mind to it! Grab an extra job. Despite media reports, there are plenty of jobs out there you can find if you know where to look. You could even find some legitimate work from home jobs ! The extra money will help you not live paycheck to paycheck and will take the burden of low-income off your shoulders. Find a job you love though, don’t settle! If you don’t love your work, it won’t last. The sooner you make a budget, stop adding new debt, lower your expenses, and grab an extra job, the sooner you’ll be living with more than enough money at the end of the month. And don’t forget to get yourself to a point where you can spend this month’s income next month! (My wife and I have been doing this for years, and love it.) Take heart that with a high level of determination, you can live with more money in the bank than you ever thought possible. You’ll fend off emergencies as if they’re small inconveniences, wonder why everyone else is eagerly anticipating payday, and keep a smile on your face throughout the month knowing you’re financial secure. Are you living paycheck to paycheck? Leave a question below and we’ll try to help you with your situation. Related Articles: How To Set Up A Budget With Inconsistent Income Reality Paycheck: A Lesson Learned About Money How to Start a Budget: Things I’ve Learned The Hard Way How to Lower Your Expenses Without Losing Your Mind! John Frainee is a personal ﬁnance writer at TheChristianDollar.com . His goal is to provide biblical ﬁnancial principles that encourage people to live healthier lives. Beyond personal ﬁnance, John enjoys spending time with his wife and two crazy cats, playing a competitive game of Monopoly, and reading just about anything he can get his hands on. You can also ﬁnd him on Twitter and Facebook .
How to Stop Living Paycheck to Paycheck