5 Ways You Can Stop Living from Paycheck to Paycheck

Courtesy: Bettina Smith

Everyone that ever lived (of lives) from paycheck to paycheck knows how difficult it is just to live a normal life without any financial worries, as in knowing where your next meal is going to come from or simply having enough money to pay bills. There is hope on the way! Although it is not easy, it is feasible--if you are committed to doing it.

Here are five ways in which you do not have to live on paycheck to paycheck basis:

• Learn about the benefits of not living from paycheck to paycheck: If you have plans on not living from paycheck to paycheck, then you will have to make some major financial lifestyle adjustments. Rather than feeling like you have to sacrifice almost everything that you want, just think about your spending habits. When you begin to get a grip on your finances, you will reap the benefits of:
• Paying off your debts (whichever that is, credit cards, student loans, etc.) to lower your monthly payments.
• Be able to build up on your emergency fund in case of unexpected circumstances
• Make an investment for retirement
• Save for that large purchase, as in buying a house, buying a car, or even a vacation

When you understand these wonderful benefits, trust me, you will be very motivated in taking charge of your financial future and staying committed.

• Do not go crazy spending: In other words, have a very good reason for spending. Do not just spend just because you are in possession of a credit card or that cold, hard, green cash! This is how many people get burned financially. It is very important to understand your spending habits at the moment. You can do this by creating a budget worksheet--this is one way of keeping track of your finances, as in expenses. In addition to creating a budget worksheet, you can track your expenses by using an app such as You Need a Budget. When you get ready to create your budget worksheet, think about where you want your money to go.
• With smart budgeting, reduce your spending and costs: Another way of not living from paycheck to paycheck is just not spending all of your hard earned cash. Just think for a minute: do you have a gym membership that you have not used in over two years? Can you negotiate with some of your bills? These are the few things that you need to take into consideration. You can still have fun without spending all of that money. Suggestion: plan a get-together dinner with family and friends at your house rather than going to Spago's (sorry, Wolfgang Puck). It will be much more cost effective!

Some people may think just because you are reducing your spending habits that you will miss out on the greater things in life. In reality, you can be just as happy (or even happier and more financially free) than the ones that are "living large."

• Get some additional income: In many cases, you can also increase your finances by seeking additional income. This can range from getting a part-time job or even starting a side business, which is even better (just do not let your employers find out about your moonlighting endeavors). If a side business or getting a part-time job is not in the cards for you, then consider asking your employer for a raise. Or, you can fulfill your financial obligations by selling some stuff that you no longer use or need.
• More importantly, reward yourself with a payment: If you want to run away from the living from paycheck to paycheck regimen, then it is time to save, save, save! Set up a savings account (if you do not already have one) that has an automatic transfer--that way little money will go here from time to time.

The reason that the majority of people are living from paycheck to paycheck is due to the fact that they lack financial literacy and/or run across unexpected circumstances, as in a job loss or even major car repairs. If you want to get away from the paycheck to paycheck rat race, then you should live below your means. This way, you will begin to feel more financially secure and have the financial freedom that you have always desired. Until then, Happy Saving!

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