Many people believe that living paycheck to paycheck means saving is impossible. But it doesn’t have to be. Learn how to break the cycle here.
Are you living paycheck to paycheck? If so, don’t feel bad, 80% of America is right there with you.
However, just because something is commonplace, it doesn’t mean it’s right. You don’t have to live paycheck to paycheck, nor should you.
It doesn’t matter why you’re struggling financially, we’re not here to judge. We’re here to help.
Keep reading for our top 5 tips on how to save money, even if you’re barely getting by each month!
How to Save Money When You Live Paycheck to Paycheck
Bear in mind, in order to turn your financial situation around, you’ll need to make some changes. You’ll have to sacrifice certain ways of life, possessions, and even your living situation.
However, remember that those things are what put you here in the first place. If you find yourself feeling resistant to change, consider the alternative – staying cash-poor for the unforeseeable future.
- Downsize Your Home
First, your biggest monthly expenditure is likely your rent or mortgage. Whether you rent or own, you can always downsize. Most people buy way more house than they need anyways.
Get out of your lease or start taking serious and immediate steps to sell your home. If you can go from paying $1,500 a month down to $1,000, that’s a whole lot of savings!
Moving is a hassle, yes, but the amount you save long term will more than make up for the effort. Be prepared to need your taxes, payment history, and more when looking for a new house. You can use a pay stub generator if you don’t have access to your monthly income.
- Get a Cheaper Car
Next, think about the type of car you drive and why. Expensive car payments are one of the top reasons people live paycheck to paycheck.
Is it a status symbol? How much are your monthly payments? How much do you owe in total?
Sell your new car and downgrade to something that you can buy with cash or that requires a much smaller loan. There are plenty of decent used cars out there for $5k or under.
If you don’t want people looking down on you for driving an older car, you need to re-address your priorities. Would you rather appear to have money because you drive an expensive car, or actually have money because you don’t?
- Get Rid of Unnecessary Memberships and Subscriptions
Next, in order to stop living paycheck to paycheck, get rid of all your excess monthly payments such as account subscriptions, gym memberships, and so on. You don’t need that stuff, and you could potentially save hundreds of dollars each month by canceling them.
- Consolidate Your Debt
Next, consider a consolidation loan. These types of loans absorb all of your debt into one loan, giving you a single (typically lower) payment. It makes it much easier to manage your finances and can really improve your credit score.
- Create a Budget
Finally, sit down and create a budget plan for yourself. Write down every expense you have and find ways to save. Figure out what you do and don’t need.
Be harsh with yourself, ditch poor spending habits and get rid of unnecessary luxuries.
You Can Have Nice Things
We know this all sounds a bit extreme, but when you’re living paycheck to paycheck, your entire life is extreme. You’re constantly stressed about money and would be completely vulnerable in the event of an emergency.
However, taking these steps will get you out of debt and balance out your finances. And eventually, you’ll be able to actually afford the things you have to give up now. The difference is, they won’t be killing your finances!
Good luck, and remember to check out the rest of our articles for more helpful information and tips!