Do you get your paycheck and immediately spend every bit of it without putting any in savings?
Do you have trouble keeping at least two months of salary in your savings account because you are always using the money to buy something?
Do you run out of money before the next paycheck arrives, just hoping you can survive until the deposit hits your account?
Have you bounced more than one check in the last two years?
If you answered yes to any of the questions above, you may be the kind of person who feels pressured to spend money if you have it. The behaviors listed above are telltale signs of a person who has grown accustomed to living paycheck to paycheck.
While some people work very hard and still barely scrape by, most of us have unnecessary expenses that we can reduce or cut in order to start changing the way we spend and the way we live, stretching paychecks further and finding a little extra money to either pay off credit debt or put in savings.
If you are living paycheck to paycheck, in debt up to your eyeballs, and you spend money on any of the following items, you may be able to reduce the amount you are spending. (We’re assuming you don’t have a maid or gardener, don’t spend $100 a week at the racetrack, and don’t have season tickets to the professional sports team in your area):
- Cable – switch from cable to Amazon Prime or Netflix streaming and save $60-200 per month
- Cell phone – switch from a contract plan to a prepaid phone and save $40 – $175 per month.
- Magazine subscriptions – cancel subscriptions and read articles and news online for free and save money every month.
- Acrylic nails, expensive hairstyles, weekly massages – try reducing how often you obtain these services or cut them out all together and watch your paycheck stretch.
There are many other expenses you can reduce or eliminate. Many more debts (such as student loans) can be deferred or have the payment structure changed to make them easier to manage.
If you are living paycheck to paycheck, even the smallest of changes can make a difference in your financial health, and the money you save can quickly add up when used to pay off high interest credit cards.