Is Your Paycheck Reaching Far Enough?
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If there’s one thing that many people have in common regarding their finances, it’s the assumption that their life would be easier if they just had a little bit more money coming in at the end of each month.
People assume that if their paychecks were just a little larger, many of their problems would disappear.
Those who say that money can’t buy happiness have never been in the position of not having enough to get through the week, let alone the month. However, unless you have a genie tucked away somewhere in your attic, the chances of your income magically increasing out of nowhere are slim.
Sure, there are things that you can do to increase your income, like taking on more work or finding another job on the side, but many of those things can make your life a lot more difficult in the long run.
If you want to end up with more money in the bank at the end of the month, the best thing to do is to try and make your existing paycheck go further, while also trying to change career paths.
Table of Contents
Tips for Making Your Paycheck Stretch Further
Create a detailed household budget
The first step towards making your money go further should always be to create a clear and detailed household budget. Many people make a budget and only include the most obvious things, assuming that that will be enough to keep their finances in order.
However, if you’re leaving anything off your budget, it will probably come back and bite you further down the road. When creating any household budget, you need to make sure that you think carefully about every single expense that you have and things that you’re likely to spend money on relatively often.
There’s a temptation to avoid including everything because it makes your budget look better. But that defeats the purpose of budgeting.
Build emergency savings
No matter how much you want to believe the unthinkable will not happen to you, we sadly inform you that unexpected events are just as their name indicates – unforeseeable.
Whether we talk about a last-minute car repair or an urgent healthcare expense, it is crucial to have savings that will cover the costs of such an unpleasant event. We know clearing debt is your #1 priority, but you should also include an emergency savings fund.
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Creating an emergency savings fund is easier than it sounds. All you need to do is start will regular, small contributions. This will help you rationalize your budget and commit to saving even if your income is not the highest.
Nevertheless, keep your monthly spending the same, as saving will seem harder to accomplish. And ensure also you do not over-save; consider instead depositing into your retirement account that will start making money on its own over time.
Earn some money on the side
There are so many ways to make extra money on the side. From junk hauling and selling stock photos to babysitting / pet-sitting and crypto trading – the choice is yours.
Ensure you select a side hustle that best aligns with your lifestyle and needs rather than something that will only tire you out. If crypto trading has allured you, that is great, but you first must conduct serious research. Consider learning how to buy crypto.
Consider the debt snowball
A payoff strategy will make your debt more approachable and faster to repay. Your main goal is to eliminate debt years ahead, but this is impossible if you continue to pay the minimum monthly payment.
As the saying goes, focus on one thing at a time. Instead of spreading considerable payments chaotically among all your debts, consider allocating a larger lump-sum payment towards a particular debt while making smaller payments for your other debts (although we hope there is no other).
When the targeted debt is paid off, select the next one and follow the same steps until no debt is left.
Reexamine your regular bills
Once you know what your regular bills and expenses are, reexamine them to see if there’s anything that you can do to make them more manageable. The truth is that most people are paying far more for things like insurance, utility bills, and all of the other possible regular accounts that they take for granted.
Most companies tend to assume that you’re going to want to avoid having to shop around for the best deal time and time again, which is generally true, which means that they often will raise their prices bit by bit, not enough so that you notice, but enough so that after a year you’re paying far more than you initially expected.
Of course, the key to avoiding this is to put in that little bit of extra effort to find the best deal out there. If you let your current providers know that you’re planning on changing to get a better deal, they will likely offer you a lower price to try and keep you.
Sure, it might not seem like a particularly huge dip in price, but when it’s something that you’re paying every single month, the tiniest sum really can make all the difference in the world.
Look for the best possible deals
Whether it’s for your regular bills, something significant, or just a little shopping to treat yourself, you should always try to find the best possible deals. This has always been tricky since, historically, if you wanted to compare prices, you had to go from store to store.
However, in the modern era, finding the best deal is as easy as clicking a single button. Thanks to the internet, you can compare prices incredibly quickly and easily.
Sure, this is still a little more effort than just buying something the moment you see it, but the reality is that paying a little bit more attention to where you’re spending your money can make a massive difference at the end of each month.
Don’t be too impulsive. If you see something you want, there is almost always going to be a place where you can find it cheaper.
Settle your debts
Debt is one of those words that can bring even the most well-adjusted person into complete and total panic. People assume that you’ll be stuck in debt forever and that there’s no way out of it under any circumstances. However, that’s not the case.
The truth is that there are plenty of ways to settle your debts, and doing so will make a massive difference to your bank balance at the end of each month. One of the best things you can do is to consolidate your debts as much as possible.
By consolidating your debts into one single monthly payment, you’re making it much easier to track where your money is going.
The reality is that debt can be a severe challenge, but you can still overcome it!
Keep an eye on how much you’re spending
Most of us assume that our bank account is empty or overdrawn at the end of each month because of large purchases and hefty bills; sure, those things make a huge difference. But one thing that people forget about entirely too often is how much impact those smaller, more frivolous purchases can make.
People assume that spending a little bit here and there isn’t going to make any difference to their bank balance, and a single purchase probably won’t. But the thing about those little purchases is that they add up surprisingly quickly.
If you’re spending a little bit here and there over a month, you could end up paying more than you have without fully realizing it. The best thing to do is to keep a note of everything you spend, no matter how small a sum, and track it alongside your household budget.
Many assume that they will only be able to start saving money if they’re in a position where they feel as though their paycheck is stretching farther away. However, the truth is that anyone can start saving. It’s just a matter of how much you’re putting aside.
In the same way your spending can add up incredibly quickly, so can your savings. Even if it’s just a tiny bit each month, that can make a difference if you need some extra cash. Having that safety net to fall back on in emergencies can take a huge amount of the stress and weight off your shoulders if you end up in some difficult financial situation further down the line.
The reality is that there will always be problems that come up and whether it involves some accident, requiring help from a company like Amistad Immigration Bonds, or having to pay medical bills, being able to prepare for and handle them is an essential part of life.
Never assume you don’t have to be careful with your finances because things are going well now.
Many people assume that increasing your bank balance is something you can only do if you’ve got a lot of money coming in, but that’s still being determined. A larger income could make many people’s lives much easier, but waiting around for that day to arrive will leave you feeling like you need more money at the end of each month.
By thinking more carefully about the money you do have, rather than simply lamenting the money that you don’t have, your life and finances will be much easier to manage daily.
Sure, it’s often a challenge to keep your spending in check, and there will always be things you can only help with but spend what you would like. Still, if you’re willing to put in the work, then you will be in a position to make your paycheque go much further than you might ever have expected.
Greg is a Chartered Financial Analyst (CFA) with 22+ years experience in Financial Services. He has held numerous FINRA Securities licenses (series 7, 63, 65, and 66), and is an expert on Investment Products and Financial Planning. Greg has 22+ years experience as a real estate investor and degrees in Psychology and Philosophy.
Greg has been quoted/interviewed in Yahoo Money, Yahoo Finance, USA Today, Authority Magazine, Realtor.com, Business Insider, and others.
Greg is an avid runner, and the father to identical twin girls and their awesome brother. His love of budgeting and his kids led him to join The Great Resignation in 2021.
Disclaimer: Any Financial Tips on ChaChingQueen are general and informational. Speak with a professional about your specific situation.