In today’s economy, it is not unusual to see people living paycheck to paycheck. It does not mean that they are irresponsible, and it does not mean that they will never get beyond this precarious state. If you are someone who is currently living paycheck to paycheck, there are things that you can do to get a little bit of breathing room. Consider some tips to help you get your feet underneath you, and remember that consistent effort is the key to getting ahead.
Create a Budget
Creating a budget is a first and most important step to stop living paycheck to paycheck. While you may have a vague idea of how much you make versus how much you spend, it always helps to get things in black and white. Sit down with a pad of paper, a pen and a calculator, and start writing out a list of your monthly expenses. Don’t forget to sit and consider things like medications, entertainment and gas. If you spend money on it in a month, it is an expense. Then sit down and write a list of your post-tax income for each month. Compare the two columns. If your expense column represents a significantly larger amount of money than your income, it is time to cut expenses or to start making more money.
Create a Buffer
Start saving as much money as you can. While it can be hard to live at your bare bones minimum for a while, there is a short-term goal in mind. For example, simply cut out your entertainments unless they are below a certain amount or free, or save money by eating in for the month. The key is to get enough money that will last you for a month. This buffer allows you to stop stressing out about cash, and it can make you a lot more confident about many things. It takes some work to build up a buffer, but it is entirely possible.
Buy in Bulk
At first, buying in bulk will cost you more than you like. After all, buying 12 of something is a lot more expensive than buying four of something. On the other hand, when you look at the unit price, you will discover that you are saving quite a lot of money over time! Take a moment to learn more about what you buy and what you can buy in bulk. This will help you reinforce good spending habits, and it will also ensure that you can have the supplies that you need on hand at all times.
Stop Eating Convenience Food
If you can, skip the convenience food. The rule of thumb is that the more convenient it is, the more expensive it is. If you are on the way home, bypass the fast food places and go home and eat instead. If you are at the grocery store, you’ll discover that it is far cheaper to eat produce and things that need to be prepared rather than instant food. Even buying frozen produce or canned goods is less expensive than eating reheatable dinners. If you live in a food desert, however, where there are no places nearby to buy produce, your options are unfortunately limited. In this case, consider buying food that is as close to pre-processing as you can get. If you can, make long trips to better grocery stores and buy a lot of food at once.
Make a Pay Day
One way that many people get themselves into trouble is by letting things go overdue. If you have been having issues with forgetting about when bills are due, simply set a day during the month and pay all the bills then. Paying bills in a timely manner allows you to skip the overdue charges, and it also introduces more money management into your system. If you are paying your bills regularly, you will also find that different companies are more forgiving if you have to miss a payment.
Budget Your Splurges
Living completely sparsely and with no fun at all is just as stressful as living paycheck to paycheck. It is something that eventually leads to depression, and in many cases, it leads to irresponsible spending when you can’t take it anymore! Even if you have only 15 dollars or less to spare every month, consider putting some of it towards having fun. Your favorite form of entertainment might be going out for dinner, playing a massive multi-user roleplaying game online or heading out for a drink. Wanting to have fun is not something you should feel guilty over, no matter how poor you are. Budgeting for your fun helps you enjoy yourself responsibly.
If you are someone who is invested in getting out of your financial rut, it is true that it takes work. When you want to stop living paycheck to paycheck, consider your current financial situation and remember that it can improve!