How to get out of living Paycheck to Paycheck Part II

If you haven’t already, read:  Living paycheck to paycheck Part I

How Did I Get Out of it?

1. I recorded all of my expenses for a month. This helped me really see where our money was going. However, it was not extravagant. There wasn’t enough. We were a one-income family and had gotten into debt for various reasons. I was a stay at home mother and my husband was struggling to keep our family afloat. We could barely cover the basics.

2. I was looking for various ways to cut back. But instead found out that we were not spending money where it needed to be spent.

3. I learned to be okay just where we were. When times were rough we used credit cards to help get us through. That made the situation worse. We couldn’t make the debt repayments.

4. I learned to prioritize our spending.

Groceries, gas, car payment, housing, utilities, clothing, education, recreation and then debt repayment.

The credit companies worked with us. We are at a place where we can make the payments now.

What Else did we do?

1. I applied the personal financial planning percentages. We were pretty close.

2. We started making the house payment on the first instead of the 15^th. This was hard. We had to really cut back for a while. My husband had the opportunity to make a little more money with his auto business. This made all the difference in the world. When it came time to make the house payment, we concentrated all of our efforts on that. Which meant for us, to start saving for about a week or two in advance. This meant we could not pay the debts off- the credit cards. Thereafter, we started making the other bills on time too.

3. We still did not have an emergency fund. This came about when I started working. I worked part-time doing different things until I finally settled on what I was meant to do. It’s so true what they say, do what you love and the money will come! Well, it did.

4. Get good on what little you have and God will give you more. You can live well on less.

5. So now that I am making more money we don’t need to spend more. All of our basic needs are met. That doesn’t change. And now that living expenses in the U.S. are at an all time high, we are not affected by it.

This can happen for you too.

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