If you are an American reading this, then it’s about a 50-50 chance that you are living paycheck to paycheck. Yahoo Finance did a survey that found that a whopping 49% of respondents were living paycheck to paycheck. Read that again. Almost half of Americans are living paycheck to paycheck. Here are the reasons that the people who participated in Yahoo Finance’s survey reported for why they are living paycheck to paycheck and some tips on avoiding living paycheck to paycheck:
They don’t make enough money. For the person that feels that they are living paycheck to paycheck because they don’t make enough money, you have one of two options. Option number one is to increase your income. Go get a side gig, find a higher paying job, or start a side business. Option number two is to decrease your spending. Create a budget, figure out where your money is being spent each month, then start making cuts. Cut out subscription services, pay more attention to what you’re buying at the grocery store and try not to waste food, and avoid eating out. These are two options, but utimately, there’s nothing stopping you from doing both if you really want to make progress!
Their cost of living is too high. For the person that feels that they are living paycheck to paycheck because their cost of living is too high, you’ve got basically the same two options as the person that feels they don’t make enough money. Option number one is to increase your income. Option number two is to live somewhere cheaper! If you are living paycheck to paycheck because your cost of living is too high, then you either need to make more money or move somewhere cheaper (or both). If neither of these options are possible for you, then you will have to look at your other expenses and see where cuts can be made.
They have too much debt. For the person that feels that they are living paycheck to paycheck because they have too much debt, then you ultimately need to get out of debt! How? Using the debt snowball. You list out all of your non-mortgage debts, then you make only minimum payments to all of them except for the one with the smallest balance. For the one with the smallest balance, you throw every extra penny at that one to get it paid off. Once that one is gone, then you move on to the next smallest one and do the same thing. The debt snowball gives you a plan to pay off the debt, but it does not create extra money to pay toward the debt. If you are living paycheck to paycheck, then you might not have any extra money. The same options for the first two reasons apply here: increase your income and/or decrease your spending. I would highly, highly recommend that you do both in this situation because in this situation, debt is actually stealing from you each month in the form of the interest that you are paying. The best thing you can do is get rid of your debt. It will be a lot of hard work and it will require a lot of discipline, but it will only be for a season of life until you get yourself out of debt.
They are unemployed. For the person who is unemployed, then if you are able, you should try to find a job. If you are unable, you will need to be diligent about budgeting and living within your means.
They have bad spending habits. For the person that feels that they are living paycheck to paycheck because they have bad spending habits, your solution is in your reason! Break your bad spending habits! It will be hard, I know. But isn’t living paycheck to paycheck hard? Being financially responsible is hard and living paycheck to paycheck to paycheck is hard. Choose your hard.
If you are on social media, go give my pages a like or a follow! You can find me on Instagram and Facebook @survivetodaybudgeting. If you like this blog and you think that other people might benefit from reading it, share it on your Facebook page and tag me @survivetodaybudgeting. It really helps!
If you would like some one-on-one advice on creating a budget or creating a plan to avoid or get out of debt, click on the Budget Coaching button below or contact me to schedule a free consultation call! Also, if you haven’t already, sign up for my monthly newsletter! I will be sending out exclusive content each month and you will get a free budget guide as a thank you for signing up!