How to Stop Living From Paycheck to Paycheck


When you live paycheck to paycheck, you are constantly scrambling to make ends meet or running out of money before the end of the month. It can be stressful because you feel like you never have quite enough to cover all your bills—and buy those things you want each month. When you live paycheck to paycheck, it is nearly impossible to get ahead financially. You may not be able to handle an emergency. Often, you end up overspending each month, and you run up more debt each month.

Learn to Budget

The biggest thing you can do is to learn to budget effectively. When you are budgeting effectively you are tracking your spending, and you stop spending when you run out of money. A budget that actually works has all of your expenses built into it so that you are not surprised when your bills are due. This is the biggest step you can take to stop living from paycheck to paycheck.

Set Money Aside Each Month

The best way to stop living from paycheck to paycheck is to have money in the bank. You can do this by taking money out of each paycheck. For your initial emergency fund, you should have one month’s paycheck in the bank. This emergency fund is the key to stop living from paycheck to paycheck in the long-term. When you have savings, you feel better equipped to deal with life’s unexpected challenges. Just be sure you don’t dip into your savings once you begin setting it aside.

Don’t Rely on Bonuses to Get By

When your company offers regular bonuses, you may begin to rely on your bonus as part of your budget. Because this is not guaranteed income and your company can stop giving out bonuses at any point, you should never rely on your bonus to cover your expenses. Instead, you should create a spending plan for your bonuses. You can use it to pay down debt more quickly or to increase your emergency fund.

Consider Downsizing

If your discretionary spending is already extremely low, it may be time to consider making a lifestyle change. That may mean moving to a cheaper house or apartment, dropping the expensive gym membership and opting to walk or jog in a nearby park, or trading in an expensive car for something with less flash and better gas mileage.


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