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Break the Cycle of Paycheck to Paycheck Living

Updated on June 17, 2010

Most people in the United States, regardless of the amount of the paycheck, live paycheck to paycheck. Living paycheck to paycheck means you have no cushion in the bank and you are waiting on the next paycheck to pay the bills due. If you have extra money in the bank and can pay bills as they come without worrying about where the money is going to come from, then good for you. Way to go! You are several steps ahead of the majority in terms of being in control of your finances. Let's talk about how the majority of people can get to that point.

First and most importantly - do not spend all of your paychecks. Live below your means and make sure that you have extra money at the end of each pay period. Put money into savings each month to be a cushion to cover emergencies or unexpected things that pop up. I have found that it is the unexpected stuff that frequently blows a budget and creates financial stress. If you live below your means then you will have the money to cover this and over time have extra money in the bank.

Second, make a plan for your money. Figure out where your money needs to go each month based on all the bills that come in each month. It might take some time, but it will be worth it in the end. Once you know the set bills that need to be paid each month you can make sure you have the money in the bank ahead of time. After you know the set bills, figure out where the rest of the money needs to go. You know you need food and gas for the car. There might be school fees that come up, clothing needs, haircuts, gifts, etc. Decide how much is needed for those. If you end up with an amount larger than your income you have to cut somewhere. Trim as much as you can until you are living as far below your means as you can.

Once you have done these two things you will quickly build up a cushion in your checking account so that you are not living paycheck to paycheck anymore. When you get a nice cushion then start building your savings. Unexpected expenses can ruin the best laid plans. Try to anticipate everything you can and set money aside ahead of time. For instance, I know that our car insurance is due every six months. I set money aside in a savings account each month to cover this bill. It isn't an emergency when the car insurance bill arrives. You shouldn't have to scramble to cover it. Planning ahead for everything you can will make your life much less stressful.

You will find that planning ahead for as much as you possibly can, living below your means, and having a plan for your money (a budget) ahead of time will make living a lot easier. You will no longer have the financial struggles you have living paycheck to paycheck. Once you reach this point you can relax and enjoy life a whole lot more.


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    • Darknlovely3436 profile image


      7 years ago from NewYork

      a very useful hub....

    • profile image


      7 years ago from Dayton, ohio

      My wife and I lived paycheck to paycheck from the start. I never made much money and whenever we had a little extra it seemed something would always come up, such as the car breaking down and that always took the extra money and more. I also had bad luck with my work, I was at a place 11yrs, starting to make good money, then the company shut down. It took me 16 yrs to get back up to the amount of pay I was at, then the company I was working at then after 14 yrs went belly up. I just have BAD luck with money.

    • Tweetmom profile image


      7 years ago from Newark

      Thats an obvious tip that people normally forget to follow..i would think because humans has a lot of temptations to spend rather than saving but after reading this hub, i hope this will be a friendly reminder. Thanks Jennifer

    • heymcs profile image


      8 years ago from Utah and DC

      Hi Jennifer-Your ideas are right on the money. Living from paycheck to paycheck is sadly very common & most people don't think they can change. Your suggestions are very practical and easy to implement - first and foremost to have a plan. When you know what you are aiming for (and why) it makes it easier to stick to it. Thanks!

    • How to - Answers profile image

      L M Reid 

      8 years ago from Ireland

      Yes I agree and when you are not living paycheck to paycheck you actually give yourself a little bit if freedom. You can relax more and have less stress to deal with. You are not so much the slave of your employer as you have some breathing space money wise.

    • bayoulady profile image


      8 years ago from Northern Louisiana,USA

      Great hub! I love having the peace of mind of knowing that the bills are paid, even if I have to drink store brand beverages and eat cheaper cuts of meat sometimes. I have a plan, and I work the plan. I enjoy it!

      I read a book where the author spoke of the "latte factor". It simply means that little extravagances you allow yourself can add up, just like NOT spending the money on a latte(steak,magazine,etc.) can add up.

    • profile image


      8 years ago

      This is such a good hub. Breaking the cycle of paycheck to paycheck is never easy, but it can be done. Hub up.

    • CILLAROY profile image


      8 years ago from Accra, Ghana

      good info, we really do need to leave below our means NOT within!

    • HealthyHanna profile image


      8 years ago from Utah

      The only way to live. No matter how much money you earn.

    • Seakay profile image


      8 years ago from Florida

      Good points! I have always lived on a budget. My husband gave me his paycheck and only took a little spending money. Even when I no longer had to really budget my money, I tried not to be extravagant. I think those pictures of the hungry children on TV kept me frugal!

    • KoffeeKlatch Gals profile image

      Susan Hazelton 

      8 years ago from Sunny Florida

      Great common sense outlook on how to not live from paycheck to paycheck. very interesting and useful tips.

    • VizFact profile image

      VizTV Media Services 

      8 years ago from Houston, TX

      Living a frugal lifestyle definitely creates a situation where there should be extra finances to mess around with.

      Nice Hub, awesome content.

    • Hungry-n-Foolish profile image


      8 years ago

      Hi Jennifer.. Just stumbled upon your hub. Well, the thing which I felt as the undercurrent of this hub, is that, curtail yourself and save.. and then create a financial cushion to encounter any abnormal situation.. And yes, the later half of your hub is really good.. knowing where your money is being spent and then plan accordingly.. but.. the first half.. regarding "Living Below Your Means" .. just somehow.. doesn't connect.. with me at least. And, believe me.. this has prompted me to write a hub regarding this.. thanks for the inspiration.. I will soon post my link for this new hub.. And yeah.. you write really well!

    • Edward Daniel profile image

      Edward Daniel 

      8 years ago from United States

      great tips.!

    • Beth Therese profile image

      Beth Therese 

      8 years ago from New York, NY

      This is a great hub. Not living paycheck to paycheck is a fairly simple concept, but so difficult for a lot of people. I like the tips you give to help people get out of that cycle!

    • marlboro profile image


      8 years ago

      This is a very good hub. Thumbs up

    • annathequietone profile image


      8 years ago from the big state of Texas

      sweaome hub

    • kaja_mel profile image


      8 years ago from Saraland, AL

      This is a good hub Jennifer. It was very informative to me.

    • Lily Rose profile image

      Lily Rose 

      8 years ago from A Coast

      No nonsense common sense. Great info! We are living paycheck to paycheck for now but I have a plan and once we get out of debt we will be living pretty, I hope!

    • 2besure profile image

      Pamela Lipscomb 

      8 years ago from Charlotte, North Carolina

      Very important points. Especially with this economy. Spend less...

    • sheila b. profile image

      sheila b. 

      8 years ago

      I like reading about your common sense approach to making our everyday lives better.

    • Hello, hello, profile image

      Hello, hello, 

      8 years ago from London, UK

      Thank you for your great help.


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