How to Stop Living Paycheck to Paycheck (at $50K and Above)

Money

By Contributing Author

A man named Steve Maraboli, author of a book called Life, the Truth, and Being Free, wrote, “Incredible change happens in your life when you decide to take control of what you do have power over instead of craving control over what you don’t.” 

When living paycheck to paycheck, it might be easy to imagine that the answers to all of your financial problems lie in making more money. But when you’re earning $50K a year (or more) and still living paycheck to paycheck, the salary level might not be the scapegoat. Which brings us to our first tip: 

Learn to Make Do with Less

If you’re trying to support a family at the poverty level, this can be an insulting proposition. However, this article is geared towards higher earners with difficulty saving money.

Back in 2008, Seth Godin wrote a blog post called Urgent Personal Finance Advice. In it, he talks about how to get out of credit card debt and start saving money. His advice? Stop going to restaurants, shopping for clothes, subscribing to cable TV, and going out for coffee. Instead, carpool to work, skip vacation, and maybe even take in a tenant. “Eat brown rice and beans every night for dinner,” he says. “Act like you have virtually no income.”

Living as though you earn less than you do can allow you to regain control over your finances, pay off your debts, and start saving money.

Consider Minimalism

To learn from minimalism, you don’t need to get rid of all possessions except for a toothbrush, three solid-color shirts, and a meditation cushion. The reason minimalism is rising in popularity is partly because of the appeal of digital nomad culture (because frequently moving across the country with a sofa and a queen-size bed is a drag) and partly because the underlying philosophy can help you renegotiate your relationship with possessions. 

Not all who practice minimalism sleep on the floors of tiny studio apartments or live off of green tea and brown rice. But they think twice before hitting the “buy now” button on e-commerce websites. Two great books about minimalism are The Abundance of Less: Lessons in Simple Living from Rural Japan by Andrew Couturier and Goodbye, Things by Fumio Sasaki.

Use Free Resources

The $9/month for Netflix might not seem like such a big deal, but chances are it isn’t your only monthly subscription. Instead of paying for entertainment, see what your local public library has to offer. Many libraries today lend ebooks, music, and movies in addition to old-fashioned physical books. 

If you’re thinking about buying software for your computer, consider going free or open-source. Instead of Microsoft Office or Apple iWork, try LibreOffice, Apache OpenOffice, or Google Workspace. Instead of Adobe Photoshop, try Pixlr, GIMP, or Canva. Instead of Adobe Premiere Pro, try Shotcut, OpenShot, or Avidemux. There is even an open-source operating system for the computer itself; it’s called Linux, and there are user-friendly packages (called distributions) for beginners, including Ubuntu and Linux Mint Cinnamon.

Use Cash Instead of Credit Cards

Dave Ramsey, a popular personal finance advisor, recommends that you tear up your credit cards. He reasons that when you pay in cash, you feel the loss of money more directly than when you pay with plastic. If you can’t carry cash around, he recommends a debit-only card over a card that can be used for credit purchases.

Similar advice can be offered when you wish to make a major purpose. If you have your eye on a new laptop, for example, consider setting aside money each paycheck for a year instead of buying on credit. 

What to Do in Emergencies

No matter how much you try to prepare, there may be emergencies in your life. What if you haven’t built your emergency savings fund yet? You have a few options on how to deal with this.

Some recommend keeping a credit card for emergencies. However, there is always the option of a quick funds loan that can be repaid in installments. The second option eliminates the temptation of using that “emergency credit card” for a splurge getaway weekend or because your favorite retail shop is having a sale.

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