In 2014 TIME magazine reported that about half of Americans were living paycheck to paycheck. When you live without a single dollar bridging the gap from one payday to the next, it’s hard to imagine finding a way to save money, much less ever get out of the seemingly endless paycheck-to-paycheck rut. But I’ve got a secret to share with you. If you want to escape paycheck-to-paycheck living, the trick isn’t necessarily to get a new job or live like a monk—it’s to reduce your spending enough that you can start setting aside a little bit of cash each week.
Savings: Your Way Out of Paycheck to Paycheck
A savings account that is accessible during emergencies or in between paychecks is the one thing that can lift you out of the grind. Having savings means that you have a safety net, options, a certain amount of freedom and independence, and that you can avoid traps like paycheck advances, more credit card debt and title loans. Best of all, as the savings earns interest, it starts to compound and grows even more.
In order to start saving and gaining that independence, implement some or all of these changes in the coming months:
- Spend $5 less on groceries each week. You can do this by switching brands, being strategic about sale purchases, cutting coupons and doing without one or two luxuries.
- Cook all your own meals. You can save a lot of money if you make your own breakfasts, lunches and dinners. And that doesn’t mean buying prepackaged meals, but actually making foods so that it’s more cost effective.
- Cancel something. Whether you cancel a magazine subscription, streaming video service or other auto-renewing subscription, just cancel one repeating charge.
- Make a deposit into your savings account every single week and don’t touch it. Even if you only manage to save a total of $10 a week by implementing the changes above, you’ll have over $500 saved within a year, all without having to make a major, difficult change. And best of all, you’ll be well on your way to a solid savings foundation.