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.
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