Living paycheck to paycheck is a risky place to be in financially, yet millions of Americans do are in this situation every week. If you’re one of the 68% of Americans who do, take heart. You can still start to save and pay down your debt!
In its 2012 “Getting Paid in America” survey, the American Payroll Association learned more than 28,300 of the 30,611 responding to its survey would find it difficult to pay their bills if their paychecks were delayed.
If you’re among those who live paycheck to paycheck are stretched to the absolute financial limit, here are some tricks to help you start saving money and get ahead of your debt.
Write it down
To get control of your finances and save a little each week, you first need to know where the money goes.
Keep track of spending by writing it down — everything from a cup of coffee in the morning to that pack of gum from the convenience store at night. Make a record of all spending for at least a week.
Try listing everything for a whole month to see trends in your spending habits. Once you can see where the money goes, then you can trim back on some of the spending.
Trim what you can
Cut what you can from your weekly spending by trimming the little things, because these small amounts can really add up at the end of the week.
For example, instead of buying a daily coffee at the local convenience store in the mornings, brew it yourself at home and take it with you.
By the end of the week, you could save $5 to $10. By the end of the month, the savings could be $20 to $40.
After writing checks to pay the monthly bills, round the bill amount up in your check book. Say the month’s electric bill is $136, round up that amount as you write the total in your check book to $140 and save the $4.
By rounding up a few dollars here and a few dollars there, you’ll have extra cash start accumulating in your checking account.
Start a change jar
Before you go to bed each night, empty your pockets and put any change you collected during the day into a jar, box or container.
Put dollar bills in there for more savings. You’ll be surprised at how much accumulates in the jar.
Take a look at your W2
If you typically get a tax refund each year, you may be able to change your W2 tax form to get more take-home pay.
Keep in mind that changing the tax withholding on your paycheck will mean you might not get a tax refund in the spring.
If you choose this route,stash away the added take-home pay instead of spending it, or use it to pay down debt and give your finances a break from a high interest credit card payment.
What’s another way you can save extra money each week?
Photo Credit: 401(K) 2012