Profitt Report: How to break the paycheck-to-paycheck lifestyle
Nearly 78 percent of US workers are counting down until payday, living paycheck-to-paycheck according to a Career Builder survey.
“We start with all our families a real simple budget to find out what are they spending on a monthly basis,” said Jason Cryderman, president of Great Lakes Investment Advisors in Midland.
He breaks down some simple strategies to get out of that paycheck-to-paycheck lifestyle.
“You have money you need to spend like on bills, food, clothing, groceries,” Cryderman said, “but there's a lot of money people spend unknowingly throughout the month or year on what I’ll call discretionaries.” Those discretionary purchases are the extras you don’t really need such as a boat, restaurant meals and vacations.
If you can watch this spending for a month, identify where the money is going, that’s a big step. Then comes the painful part: cut some of those unnecessary purchases.
“Free up some cash and put that money aside,” Cryderman said, “whether it be a dime, a dollar, $5, $10, we have to start with something.”
Once you start saving, it’s important to leave that money alone.
Cryderman said you could automatically deduct part of your paycheck into a hard-to-reach account or enlist some help.
“It’s an account set up in two names, so you could have a spouse or a mom or somebody else, a family or friend you trust,” he said. Then, when you want to deduct money from this account, you need the second person’s okay in order to take the money.
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