How to stop living Paycheck to Paycheck! 

how to stop living paycheck to paycheck

Budgets….bluergh!

Who needs one of those?….Wellll if we’re honest we all do actually, in some form at least. We live in a world where money seems to be ‘the be all and end all‘, but wouldn’t it be great if it didn’t have to be?

One way you can stop worrying about money so much is by having a Budget. It takes the stress out of bills/debts or savings because you know you already have everything accounted for and so you can spend time on the more important things.

I’m going to share with you how my husband and I personally manage all of our expenses and how you can too! (Bear in mind this is super easy to do! the hard part is STICKING TO IT!)

So here’s a step by step guide to help you start your budgeting adventure:

1. Work out your Monthly Expenses

That’s right, go grab a pen and paper, and sit down with your spouse (if applicable) and together work out every bill that needs to be paid in a month e.g. Rent, Car Insurance, Pet Insurance, Electricity, Mobile Phones, Internet, TV etc.

2. Other Miscellaneous Payments

Now include in your Monthly Expenses anything else you need to spend money on during the month that aren’t necessarily ‘Bills’ but still something you must spend money on, such as Groceries, Petrol, Clothes.

3. Add up all the Monthly Expenses

Okay so here’s the scary part, total up all of the amounts you’ve written down and minus it from how much you earn in a month. Hopefully, you’ll find that you have some extra money left over. If not, then changes need to be made.

Start by cutting back on unnecessary expenses. Clothing is something I’ve tried to work on dramatically, after feeling the urge to purge my wardrobes I decided to invest in a book. That doesn’t sound too amazing until I tell you I purchased ‘The life-changing magic of tidying up’ by Marie Kondo. No, I didn’t need a book to tell me how to purge my wardrobes but I did need a system and I had heard good reviews about this book. It’s safe to say that it got me motivated. I’ve dramatically cut down the number of clothing items I own. It’s still not perfect but it’s 100% better. If you want to save money, in the case of clothes and material possessions I definitely suggest first clearing and sorting through what you already own. This process lends itself to appreciation and it quantifies in your mind just how much stuff you already have. Now when I purchase an item I try to remember what I already own and where this purchase would live in my house. I’m a big believer in trying to buy second hand first. Not only do you give items a second lease of life but in the case of clothing, you also reduce your impact in the fast fashion industry. Save money, save your time, save the planet…okay that last one is a stretch but every little helps.

Transport can be another area where money goes to die. Between petrol, insurance, tax, road safety tests, breakdowns, car washes, and those little green pine trees you hang from the rearview mirror, they cost a lot. Yes, you can walk more and use public transport, but if you already own a car you’re going to have to pay for a car anyway and also pay for bus tickets etc. You can at least focus on keeping your car well maintained and hopefully cut down on unexpected breakdowns.

Food is another area where you can cut expenses. For example, I used to buy a lot more food than I needed every time I’d go grocery shopping for me and my husband. A lot of it went to waste. So to make changes I cut back and started meal planning, so now I know what and how much to buy. I even make extra portions some nights so I can freeze it and reheat it next week.

What can also make a big difference is doing one big shop a week instead of loads of smaller trips- saves money on food and petrol, so it’s a win-win. Some might call this lazy but I’ve started to do my grocery shopping online. I didn’t think it would make a big difference but it really has. Some months during the year I go meat-free, I’ve been trying to make more conscious decisions regarding my consumption of meat. Buying my shop online has made me very aware of the food I’m buying, it feels less impulsive and more purposeful and planned. I don’t get tempted by cheap meat offers, I just search for organic or free range and that’s all I allow myself to see and buy. Choosing meat-free alternatives saves you a lot of money and you get to experiment with some new recipes. If you are anything like me I tend to eat the same meals over and over again so sometimes change is very welcome.

You might even want to consider getting a side job or turning your hobby into a small business. A little bit of money on the side can be very helpful to get your savings started, or if you have to save for something in a shorter period of time. I’ve enjoyed working part-time from home as a virtual assistant, let me know if you want to know more about running your own virtual assistant business below and I can write a post or we can chat.

4. Save, Save, Save!

So once you have your monthly expenses equal less than your total income then you’re on the right track! All you have to do now is work out a system that makes you save as much as that extra cash as you can! This will help you stop living paycheck to paycheck and build up a healthy amount of savings for those unexpected bills.

What sort of a System should I use?

You need to find a system that works for YOU. My biggest piece of advice is to set yourself a very attainable goal at first, you’ll fall in love with the feeling of accomplishment and hopefully, stick to your saving routine.

Here’s how we stopped living Paycheck to Paycheck!

My system is actually very simple, I’m not a big fan of categorizing absolutely everything but Monzo has been a very big help. (Monzo is an online back that both my husband and I use. There are probably very similar bank accounts but that’s just what we use.) Monzo lets you make loads of different money pots, we have one for rent, food, petrol, emergency fund etc. As soon as we get paid, we move whatever money needs to go into each category, the rest we leave in our main account pot.

The game for the rest of the month is too see how much we can save, instead of racing to spend our money. Since we have separated out the money we need for the month, including our savings, the money left in our current account is quite low, but just enough so we don’t feel like we’re completely broke.

In effect, we pretend as if we are living paycheck to paycheck although, in reality, we are building up a separate savings account without really even realizing it!

This is what works for us because some weeks we need to spend more and others less which of course is normal! A budget shouldn’t feel restraining, and if it does, then you may have to go over your expenses again and work out if they are a ‘need‘ or a ‘want‘.

A budget should give you peace of mind that you have all the money you need to cover your bills and should help you get on track to build up some healthy savings.

But remember money isn’t everything

It’s true! Money isn’t everything! This should simply help you take debts and bills off your mind so you can go enjoy life a little less stress-free! Rethinking your view on possessions can really help you if you’re struggling to stop spending. Even if you have all the latest gadgets or the most fashion-forward clothes, that won’t result in happiness but understanding that money is just money can make you focus on the more important things. Budgeting can help you learn to live within your means and help you understand the real worth of money and help it go a lot further even when you’re living on less.

What’s your biggest struggle when it comes to saving? Share in the comments below!

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