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Paycheck to Paycheck is No Way to Live

If you are one of the millions of people who lives paycheck to paycheck, you might find yourself in the situation of having more days than dollars in the month.  That can be a very scary feeling when you know that your bank account is empty, and there are still several days until you get paid. While panic might set in, if you take a minute to analyze the situation, it might not be as bad as you think. With some planning, I believe anyone can avoid the problem of running out of money at the end of the month.

If you know that you are completely broke and have more than a day until payday, organize what you need to buy. I like lists, so I would write down what you think will need money until the next payday. If the list includes food, gas to get to work, or rent/mortgage or bill payments, those are necessities. If the list includes a birthday gift, a promised dinner out with a friend, or some sort of apparel, those can be postponed or avoided. It might not be the most popular thing to do, but if your friend is truly a friend, he or she will understand that you don’t have the money to blow on eating out or buying a gift.

If you need to buy groceries, look in your pantry or refrigerator first. Most people have more than they think. It might mean eating leftovers or peanut butter and jelly sandwiches, but you can often get by with the supplies in your cupboards for several days. If you are out of gas, maybe you can carpool or take public transportation. Perhaps you could even get up early and walk or bike to work. Not every solution works for each situation, but if you get creative, there might be a way to avoid the gas station for another week.  If a bill or rent/mortgage payment is due, call the landlord or company and ask if you can have a few extra days. You don’t want a late payment to ruin your credit score, but most utility or mortgage payments allow five days after the due date before a payment is considered late.

If you truly cannot find a way to postpone necessary payments, you might have to borrow from family or friends, use a credit card, or some sort of short term loan. I would use this as a worst case scenario that needs to be paid off as soon as you get a paycheck. Make it a priority, or you could find yourself in a vicious cycle of debt and/or ruin relationships with those you care about.

Once you’ve made it to the next payday, sit down and discover why you got into this situation in the first place. The only true way to get out of the cycle of living paycheck to paycheck is to find a way to spend less than you earn.  You have to start tracking every penny you make and spend to see where the money is going. Are you spending money on things you don’t need and can’t afford like manicures or cable?

Next, you have to have a budget. This allows you to find ways to cut expenses or try to make more money so that you can start an emergency fund. With some money set aside, you don’t have to worry when things pop up to spoil the budget. Believe me, I know how hard it is to change when you are used to buying whatever you want, but by taking action and making positive changes, you won’t ever have to feel the worry of not having enough money at the end of the month.

The help avoid running out of money this month, you can enter the giveaway for $100 in PayPal cash or an Amazon gift card. This giveaway is sponsored by activehours.com, which is a new service designed to compete with Payday loans. They charge no fees or interest. While I still feel that changing spending behaviors is the better way to make a difference in the long term, this service seems better to me than any sort of a Payday loan, although I can’t say for sure as I haven’t used either. 

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About Kim Parr

Kim Parr is a private practice optometrist, freelance writer, and personal financial blogger. You can follow her journey to 20/20 financial vision at Eyes on the Dollar.

32 comments

  1. I think you are spot on Kim – a budget is a must for someone in this situation.

    Also, I’m not to sure how I would go asking family or friends for money. I guess if I was super desperate then I would, but it wouldn’t feel right about it.
    Glen @ Monster Piggy Bank recently posted..Making it through the month – $100 Cash GiveawayMy Profile

    • I would almost sell a kidney before asking my family for money, but if it meant feeding my daughter, I probably would. I hope to never get myself into the situation and I think there are steps anyone can take to stay out of it as well.

  2. I love that you pointed out discovering what the underlying problem is as opposed to just moving on. I think that’s where the real learning can come into play, which can help you grow and lead to better long term success. Great post Kim!
    John S @ Frugal Rules recently posted..Taking The Plunge is Not Just For Polar Bears – Part 1My Profile

  3. Great minds think alike! I posted some very similar tips on my post!
    DC @ Young Adult Money recently posted..When There Is Not Enough Money – $100 GiveawayMy Profile

  4. Mandy @ MoneyMasterMom

    Great job differentiating the necessary expenses, and expenses that can be postponed. Active Hours sounds like a good option for those in a pinch, Although if people don’t make efforts to change the underlying problem Active Hours will never be able to keep up to demand, and Payday Loans will win again :(
    Mandy @ MoneyMasterMom recently posted..When the cash runs out before the month doesMy Profile

  5. Learning to prioritize is extremely important when the budget is tight. I’ve met a lot of people that have chosen to pay their credit card bill when it meant they wouldn’t have enough to pay their electric bill (and even their mortgage in some cases).
    Jason @ WSL recently posted..5 Frugal Christmas Ideas for ChildrenMy Profile

  6. I would sell something if I didn’t have enough money

  7. Too often, people who live paycheck to paycheck may not be able to make the changes. You have to take a hard look at your expenses and think about what is necessary vs. optional. Sometimes, you have to take more action such as moving to a smaller place or taking in a roommate. Changes are very hard, but necessary to achieve a different outcome.

    • I like the old saying about doing the same thing and expecting different results is insanity. You might have to make some tough decisions to break a cycle.

  8. I like the idea of borrowing money from family members as long as you’re comfortable that you can repay it without any problems in a timely manner. It’s not the first solution I’d turn to, but certainly not the last. I’d probably try to sell some things first and cut back on everything that can be cut back.
    Veronica @ Pelican on Money recently posted..Powerful Lessons Learned in Starting an Online Store (Part 1)My Profile

    • I’m sure my family would loan me money, but there always seem to be strings attached, so I would also try to use that as a last resort.

  9. I don’t think we could say the “B” word more. If you don’t know how to budget or haven’t done so, then that should be the first step to getting control of your finances.
    Grayson @ Debt Roundup recently posted..The “Trying To Make Ends Meet” $100 GiveawayMy Profile

  10. The actions I would take if I realized I didn’t have enough money at the end of the month would be to check all my other bank accounts, then see what immediate costs I can eliminate – can I take public transport or carpool to avoid paying gas, can I stretch the food I have left in the pantry to avoid buying groceries, are there any commitments Ive made that require a cost(coffee with a friend) that I can re-schedule or cancel, check my “To be sold on ebay” closet and list something that will likely sell(ie electronics). Thanks for the giveaway!
    Laura recently posted..Best Cubicle PrankMy Profile

  11. My favorite part is your explanation of how to switch to survivor mode. We have plenty of food and stuff around us that can be used when in need.
    Pauline recently posted..What to do if there isn’t enough money?My Profile

    • You can actually get by pretty well I would imagine. Most people aren’t truly bare in the cupboards, but if the food you like best is gone you might feel like you have nothing to eat.

  12. Mrs Scot and I always look in the fridge/freezer/cupboards before shopping – It can save a small fortune!! :)
    Savvy Scot recently posted..Avoiding Stereotypes at ChristmasMy Profile

    • I used to always buy stuff I already had, but since I’ve been tracking, I do the same as you and it is amazing what you can have hidden away that you forgot about.

  13. K.K. @ Living Debt Free Rocks!

    This post is spot on! Great suggestions because too often people panic when instead more often than not, there are solutions to help fill the gap and get oneself out of the paycheque cycle.
    K.K. @ Living Debt Free Rocks! recently posted..Sunday High Fives!My Profile

  14. Doing a pantry challenge is by far my favorite way to make ends meet or free up funds when things get tight. I agree that examining why you get into these pickles in the first place is the best course of action. That’s what I’m currently doing to figure out why our savings rate has gone down so much even when our income has risen.
    Lena @ WhatMommyDoes recently posted..Our Emergency Fund Story & $100 Giveaway!!My Profile

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