Millions of Americans live paycheck to paycheck. In fact, one survey found that 78% of Americans live paycheck to paycheck, making finances a daily struggle.
If you fall into this category, don’t despair. While it’s common to have financial difficulties, it’s also possible to overcome them.
If you’re tired of struggling financially, this article is for you. We’ve gathered 3 essential tips that you can use today to start changing your financial state.
While implementing them may seem overwhelming, they can really have a massive impact. Keep reading to learn more.
First and foremost, one of the best things you can do when you’re struggling financially is to create and stick to a budget. It’s not rocket science and most of us have heard about budgeting since we were young.
But the truth of the matter is that a common thread among those living paycheck to paycheck is the lack of a budget or a pattern of not sticking to it.
Think about it this way. Your budget is empowering! Instead of wondering where your money went, a budget is telling your money where to go.
Here are some of the major categories to consider: housing, utilities, groceries, transportation, medical costs, and clothing.
Here’s how those different categories should add up in your budget:
- Housing: 25-30%
- Utilities: 10%
- Food: 10-15%
- Transportation: 10-15%
- Health: 5-10%
- Clothing/Entertainment: 10-15%
- Saving: 10%
- Giving: 5%
This is a rough outline that should be adjusted for your specific situation. But it’s a great baseline to know if you’re on the right track.
Identify Spending Leaks
Next, it’s time to look for leaks in your spending. This is a process that will help you identify unnecessary purchases that you could cut out to save in the future.
These could include:
- Unused subscriptions
- Eating out
- Unused gym memberships
- Unnecessary bank fees
- Impulse/emotional shopping
- Unnecessary insurance costs (know the differences here)
The truth is that it’s not fun to have to be accountable for your spending. But it’s a crucial element of overcoming financial struggles. And once you know what’s going on, you can begin to make changes.
Make Further Adjustments
Next, if you’re tired of struggling financially, it’s time to make further adjustments to your spending.
In addition to tackling spending leaks, you can also engage in other money-saving behaviors. These could include carpooling to work to save money on gas. Maybe you begin to meal prep and freeze leftovers so you don’t spend as much money on meals.
Perhaps you can start buying used clothing and furniture more. Another idea is to spend more date nights at home instead of going out to dinner and for entertainment.
Doing these things, although an adjustment, can have a big impact on your financial health.
Tired of Struggling Financially? Here’s What to Do
There you have it. If you’re tired of struggling financially, try these 3 tips. They’ll put you on the pathway to financial success and stability.
Want more tips on living your best life? Check out our blog today.