How do I make my money last longer than the 1st to the 15th?
Nobody likes darting back and forth between a bank account and calendar, worrying about making it to that next paycheck. Ending the paycheck-to-paycheck anxiety can be incredibly freeing. Here’s a little know-how to help make that happen.
The “B” word
If we want to get over that paycheck-to-paycheck hump, a budget is our best buddy. It will be a big help in figuring out if we need to trim in some areas, or just re-prioritize what we’re already spending.
Plus, a budget provides a quick snapshot of how much money we have coming in and where we’re spending it. That allows us to better track where that money is going each month and adjust accordingly. Give it a shot. We have a free budget worksheet you can use here.
Becoming emergency-proof
With a budget, we can finally jump off that paycheck-to-paycheck merry-go-round. Now let’s go even further to becoming the masters of our money by becoming emergency-proof. This means having enough money put aside to deal with those curveballs life tends to throw at us - like a broken down car or a medical emergency. Imagine how it would feel not having money worries piled on an already frustrating situation.
The first step is saving $1,000 to cover those speed bumps we encounter in life (like a car repair). Putting aside that speed-bump money gives us confidence and peace of mind knowing that we won’t have to put a big expense on our credit card and risk racking up debt.
The next step to truly feeling like the masters of our money is to save enough to cover multiple months of expenses. This is money that can help us get through a challenging situation like an injury that keeps us out of work, or even getting laid off. Whatever you decide to save will be dependent on your situation. For some, three months might be plenty, while others might shoot for six months.
To find the number you need to hit to become emergency-proof, give this worksheet a try.
Think of the weight lifted off our shoulders when we don’t have to count down the days until payday, or fret about all the worrisome “what ifs” life can drop in our path.
You’re just a couple steps away from putting all that in the rearview mirror for good.
