The phrase “living paycheck to paycheck” isn’t hard to decipher, as far as what they means to you financially. Essentially, you can’t save money and you’re just barely getting by, perhaps making your bills and not having much money leftover for anything else.
And you certainly don’t have money to start saving or have some spare cash lying around for that proverbial “nest egg” everyone is always talking about or developing a game plan for retirement.
When you’re living paycheck to paycheck, you’re really missing out on what matters and retiring from work hardly is on the table or at the forefront.
Every money expert or financial guru will tell you that you need to stop living paycheck to paycheck, but that is often easier said then done.
Beating the paycheck to paycheck lifestyle is more about a mindset then anything else, although having a budget won’t hurt, either. That mindset is about taking what you make, your income, and looking long and hard at that number and taking about 30 percent off that total. That 30 percent is what is going into the bank for you to save, and the rest of the 70 percent is for your bills. Simply put, you have to live like you make less than what you really do.
That means having the necessities and anything else that fits under a banner, a number, a total amount that is less than what you actually bring home every month.
Now, as much as you can have the right mentality, that still doesn’t excuse you from having a viable budget to work with as it relates to knowing the stats, numbers and figures to make that newfound outlook that much brighter.
If you have to make difficult decisions, that is part of the process of not only budgeting but also downsizing if need be. If your house is too big and too expensive, you have to move to a smaller one or perhaps consider renting, that will allow you to build that much needed emergency fund.
That debt you’re carrying also can’t be ignored and you have to develop a plan to start paying off the small debt first so progress can be seen, and then keep the minimum payments going on the latter. As time progresses, you’ll start to see that debt paid down, and even if that means you go a few years without cable or a cell phone plan that is high on data that you really don’t need.
At that rate, your paycheck to paycheck days will be numbered.
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