Sometimes, it feels next to impossible to properly manage finances, right? For starters, unless you have passive income, you can only go by the amount you get each month from your job. For some jobs, you’ll get a payday weekly, but for most, it’s either once a month or biweekly. If you don’t have money coming in too often and you have next to no savings, then you’re probably living paycheck to paycheck.
Around a third of people from the UK are living payday to payday, and it’s just the harsh reality. If your paycheck only comes in at certain times of the month, then you have to stretch your money as far as it can go, as tough as that sounds. So, is there anything that can be done so that you don’t have to live payday to payday? On the bright side, there is some potential. Here are some ways to top living in financial hardship!
If You Haven’t Already, Start Budgeting More Strictly
One of the most common reasons why people find themselves living payday to payday is because they are spending more than they’re earning. It’s not always true, but it happens. Whether it’s a lot of money on unnecessary expenses or simply price inflation, living beyond your means can lead to financial ruin if left unchecked.
Getting control of your finances starts with making and sticking to a budget. Start by taking a look at your past three months of bank and credit card statements, and include any cash payments you’ve made that you can remember. Include both fixed and variable expenses, such as your rent or mortgage, utility bills, car payments, food, and debt repayment.
Once you’ve figured out your monthly expenses, focus on cutting back on non-essentials. For example, if you are a big coffee fan, switching to a drip or even a reusable cup is a great way to save a few dollars. Also, try to set aside at least one month’s worth of income into savings or a debt-paydown plan. Can this be hard? Absolutely, 100% it is. Honestly, it might take a lot of time because you need to cut out things and maybe even work longer hours just so there’s a cushion. So, by budgeting, you’ll be helping yourself way more monthly.
Set Up Savings If You Don’t Have One Yet
Even if you’re not living paycheck to paycheck but you’re still struggling, such as trying to save up for major payments (like trying to fix up your house) or anything else that’s major, it can be hard to save while at the same time pay for necessities, right? For some families, it’s paying rent, paying bills on time, and getting necessities for the kids; just-needed payments are always there all the time.
So, what about savings in general? It’s so overdone and said so much, but you can’t skip this. Whenever you have extra money, you need to put that immediately into your savings account. Your savings account is going to be your weapon to no longer live paycheck to paycheck. Savings are going to be that exact thing you need to make sure that you don’t live in financial hardship.
If you have a job, then try to talk to them about savings. You can set up a savings account and get your payroll manager to transfer a small amount out of each paycheck into it each pay round. This money can be used to save for a rainy day or put toward paying off debt. In the beginning, small savings are a great way to build up a cushion.
Take a look at your monthly expenses like utility bills, cable, phone, and insurance to see where you can cut costs. For example, if you’re not using your cable service often, you may be able to cut your cable bill or switch to streaming services and save some cash. You have to stick with this and stick to it strongly, because this is going to make a huge impact on how you live and your finances overall.
In Debt? Get Out ASAP!
You’re only hurting yourself more by being in debt. Creating a debt repayment plan is an important step toward becoming financially independent. First, you’ll need to assess your current debt situation by collecting all of your outstanding balances and interest rates. You can also pull your year-end credit card and checking account statements to get a clear picture of where your spending goes each month.
Afterward, you’ll have to get a clear plan of how you can repay these. Honestly, the sooner you pay back everything, the better it’s going to be for you. So try to get out of debt as soon as possible. This is going to be the anchor that keeps you down and keeps you struggling.
Look at Your Credit Score
The United States isn’t the only country where there’s a credit score; it’s the most known, but even the UK has them, too. With that said, how does your credit score look? A lot of factors can affect a credit score from being in debt, like credit card bills, having late payments, being too much in debt, and even HELOC can have an impact on credit scores, too.
You’ll Most Likely Need More Income
It can be hard to do, but are there ways that you can make an additional income? Whether it’s a second job, doing something small part-time like a side hustle, or some type of passive income gig, you’re going to need it. Just try this out; try and figure out what you might be able to do. In the end, it’s challenging to get out of this never-ending pit of living paycheck to paycheck, but you need to try to do what you can to get out.
Consider A New Job
When it comes to additional income, have you considered getting a new job? This doesn’t mean pile yourself up with multiple jobs. Honestly, please try to avoid that because it means you’ll be burned out quicker, you’ll see your family less, and you shouldn’t subject yourself to that. However, with that said, can you try and look for a new job, maybe even a whole new career?
You never want to hinder progress when it comes to your career. But there may honestly be a chance that you are just by not applying to jobs. It’s odd, but for a lot of recruiters, the longer you’re in a job/ company, the less sought after you are because it’s believed you’re deadset on your way.
Plus, chances are, you’re being severely underpaid, and you might not even know that. You can try to talk about getting a raise, but if that doesn’t work out, then it might be a good idea to go ahead and try. If it doesn’t work out, start looking into other jobs. Your skills are desirable, and there are fantastic companies out there who are willing to pay you what your worth is.
Consider a Side Hustle
It’s so overdone, and at this rate, the advice might be generic, but some people try to get out of financial hardship by not picking up a second job but instead picking up something they already enjoy but will try to monetise instead. This could be writing blog posts, selling stock images, doing YouTube, or streaming video games. These are a few examples, but it’s going to be up to you what exactly you would want to do that you know would make you happy.
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