If you are living paycheck to paycheck, it can be stressful just to make it to your next payday.
If you are struggling to make end’s meet and pay the bills, then it feels like you’ll never be able to afford to add debt payments into the mix.
Adding debt to this equation, further compounds the stress.
Plus, missing a debt payment can have dire consequences as well as adding to your debt with fees and higher interest.
When you are struggling to make it living paycheck to paycheck the temptation to use credit cards, and other means to make ends meet can be too hard to resist. It might feel like this is your only way to make it through a tough time. But I promise you can pay off your debt even if you are living paycheck to paycheck.
Here is how to become debt free when you are living paycheck to paycheck.
Believe That You Can Do It
It’s often said that the first step toward changing your situation is believing in yourself.
It boils down to mindset. And I can tell you that our minds have a lot of power.
Don’t just sit back and think that your life is doomed to be like this forever.
Working for what seems like forever just to barely make ends meet is frustrating, but there are things you can do to turn your situation around.
Having a positive outlook on your situation can help you make the changes you need to get things done!
Just think, but what if I could?
Revisit Your Budget And Make Some Cuts
Even if you’ve already gone through your budget and eliminated every possible extra expense, you still might be missing something.
Just because you’ve removed your non-essential costs, doesn’t mean you’re done making cuts to your budget.
If you haven’t already gotten rid of any extra fluff (such as Netflix or Hulu) in your budget, start by eliminating these things right away.
Keep the positive attitude by telling yourself that you can’t afford them right now, but you WILL be able to when you’re out of debt (or meet a specific benchmark).
Negotiate Fixed Expenses
Next, start by looking at your fixed expenses. These are things such as your mortgage, rent, utilities, phone, etc.
You may be able to get cheaper rates on any of the items in your budget by either switching providers or just picking up the phone and giving them a call.
Maybe your car insurance has a couple extras you could live without (such as increasing the deductible). Or see if there are any options you could cut off of your phone bill.
A radical move to give you a jump start, think about if you could possibly switch to be a one car family instead of two?
Look into each of these expenses, and call to ask the provider if they see anything you’ve missed, before you determine that you can’t lower your budget any further.
Look For Ways To Earn Extra Income
If you are struggling to live paycheck to paycheck, then you may feel that you’ll never be able to make more than a minimum payment. In some cases, you may not even be able to afford the minimum payment (trust me, I’ve been there too).
Once you’ve cut your budget as much as you can, the next thing you need to do is find a way to free yourself from the struggle of making ends meet.
You don’t necessarily need to take on a second job in addition to what you already do in your day, but maybe you could work a few hours just on the weekends.
If you have kids at home or can’t find a way to leave the house, there are loads of ways to earn extra money from home.
Instead of wasting time on social media or in front of the TV, work on a side hustle!
Clear the clutter from your house and sell it at a yard sale or online yard sale. Think about what you could make/DIY to sell (these chapsticks are easy and fun to make), or even take surveys to earn extra money.
Use Unexpected Money Toward Your Debt
During the year we all receive “bonus” money. Whether it’s a birthday check or a tax refund, decide in your heart to but that extra money toward your debt.
As long as your food and bills are covered, then for this year instead of getting a frivolous gift for yourself, put this money toward your debt payments and make a dent in your debt!
It can be tempting to splurge when we receive extra money, but if you are in debt and don’t want to live paycheck to paycheck, for the short term, you need to put this money back into your budget or your debt.
The first step to paying off debt when living paycheck to paycheck is to change your mindset. Then figure out a solid plan to make some changes by revisiting your non-essential expenses, negotiating your fixed expenses, looking for any extra ways to make some extra money and putting any bonus money you receive towards the debt. It might feel like getting out of debt is impossible, but believe me, I’ve been there and it IS possible.
YOUR TURN: What tips helped you get out of debt? What was the thing that helped you change your spending habits? Let me know in the comments below!
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