How to Stop Living Paycheck-to-Paycheck


Barry Armstrong

Founder and President, Armstrong Advisory Group


Are you sick and tired of living paycheck-to-paycheck?  If so, you’re certainly not alone.  According to the results of a survey of U.S. workers conducted by CareerBuilder, 78% of respondents said they struggle to make ends meet.  Believe it or not, this isn’t just a problem that affects folks in the lower and middle classes.  The same survey found that nearly one in 10 workers in the U.S. earning more than $100,000 a year live paycheck-to-paycheck.  Since we know that workers who earn more money aren’t immune from financial headaches, it’s clear that most people don’t have an income problem.  Instead, it sounds like many folks have a financial management problem.  Let’s have a look at two ways to address it.


Tip #1: Establish a Budget and Stick to It


All too often, it’s easy for higher wage earners to fall victim to lifestyle inflation.  With more disposable income, many folks assume that because they can now afford to buy a more expensive home or a fancy new car, they should.  That assumption is not correct.  As a worker’s disposable income rises, it is a far more effective use of money to establish a frugal lifestyle and save for a rainy day.  Instead of spending lavishly, create a budget and commit to sticking to it at all times.  Be sure to have enough money to pay bills, cover expenses, and contribute to savings before spending money on stuff you really don’t need at the end of the day.  Those expenses should come last.


Tip #2: Automate Your Savings


It’s too easy these days to forget to set aside money to pay off debts and save.  Thankfully, there are simple methods that you can use to automate your savings and rid yourself of the need to remember to tuck money away.  For example, it might be possible to set up an arrangement with your financial institution that allows you to automatically have a portion of your paycheck deposited into a savings account.  This will help you establish a reserve fund in order to cover large purchases down the road or build an emergency fund.  To help pay debts off faster, there are apps that allow users to automatically round debit and/or credit card purchases up to the nearest dollar and send payments to your lenders using the accumulated spare change.  A great example is the ChangEd app, which helps folks pay off their student loan debts faster using the roundup concept.  Entrepreneurs and financial institutions have made it easy to automate your savings, so it’s smart to think about taking advantage of these opportunities.




It requires some discipline to stop living paycheck-to-paycheck, but the ultimate result makes the process of reducing expenses and saving money completely worthwhile.  However, even if you’re a higher wage earner, you’ll continue to barely make ends meet unless you take the first step toward the goal of financial freedom.  That first step consists of simply making the decision to get yourself into financial shape.  Stop spending frivolously and start looking at ways to cut costs, get rid of your debts, and save as much of your earnings as possible.  I’m sure you won’t regret it.


Barry Armstrong has over 30 years of experience in the financial industry.  He founded the Armstrong Advisory Group in 2004 and has been sharing his financial knowledge with New Englanders on a daily basis during his Boston-based radio broadcast for nearly 20 years.  Learn more about Barry and the Armstrong Advisory Group at  Securities offered through Securities America, Inc.  Member FINRA/SIPC and Advisory Services offered through Securities America Advisors.  Barry Armstrong, Representative.  Representatives of Securities America do not offer tax advice.  Always seek the assistance of a tax professional familiar with the laws in your state.  Armstrong Advisory Group and Securities America are unaffiliated.  August 2018


(Image courtesy of The Wall Street Journal)