How to Stop Living Paycheck to Paycheck — 5 Tips to Getting Back on Track Financially
Despite the news of economic recovery from the Great Recession, 43 percent of U.S. households would be unable to pay their bills if they went just one month without a paycheck, according to the Springleaf Financial Strength survey. These households are just a paycheck away from financial disaster.
If you are part of one of those households that is living paycheck to paycheck, it might be time to take a closer look at where your money goes each week and trim unnecessary spending where you can. Here are some helpful money-saving tips:
- Create a budget and manage spending. Simply creating a budget where you list your expenses isn’t enough. If you budget $400 per month for groceries, but actually spend $525 because you made extra trips to the market to grab a couple of items, that’s not sticking to the budget. Trimming unnecessary spending and redirecting that money towards savings is a great way to start building a financial cushion.
- Communication is the key. Everyone must get on board and communicate clearly what they are spending every day and every week.
- Focus on eliminating debt. If a part of your monthly expenditures is going toward paying off mountains of credit card or medical debt, you might consider how bankruptcy could help you get a fresh start in your finances. After you receive a discharge for a large portion of your debt, you can focus on creating a realistic plan for paying your bills on time and not acquiring any new debt.
- Work towards building up a “rainy day” fund. Even if it begins with a jar on the kitchen counter where you empty your change at the end of the day, it’s a good place to start saving.
- 5. Create a plan for how you will address financial emergencies so that you are not caught off guard.
Money management is a skill that anyone can learn. It comes down to shifting away from old habits that have placed you in a financial bind to replacing them with new habits that will put you on a more firm financial footing.
You can schedule a free consultation with a DebtStoppers bankruptcy attorney for a one-on-one debt analysis. We will discuss your situation and advise you about your options. Call us today at 312-913-0630.