Even a $1,000 cushion can help you avoid the need for cash advances or credit card debt
Another option is to pursue a freelance career where you have higher earning potential. However, these options tend to have a longer-term focus. To move the needle immediately, you may need to take on a side hustle. While some side hustles only help you earn a few dollars per week, there are plenty that allow people to earn $1,000 or more each month.
2. Review Student Loan Payments
If you owe a lot of money in student loans, one of your best options is to put your loans into an income-based repayment plan. With this repayment plan, your monthly payment is based on how much you earn.
It won’t help you pay off your loans fast, but it will help you get control of your cash flow, especially if your debt is large relative to your income.
3. Build Up a Cash Cushion
As soon as you have a gap between your income and expenses, your first goal needs to be building up a cash cushion.
Struggling to build up a cash cushion? It can help to cancel automatic subscriptions that are eating into your budget. Using an app like Trim can help you identify subscriptions that are hurting your bottom line.
Once you’ve gotten rid of the vampire expenses, consider switching to an “all-cash” budget. Put your debit and credit cards in a drawer, and only use cash for your variable expenses such as groceries, gas, and even your utility bills. Only use your bank account to pay for fixed expenses such as rent and your phone bill. Switching to actual cash makes it much easier to proactively plan your budget.
4. Pay Off Your Debt
While a higher income will help you break the paycheck-to-paycheck cycle, staying out of the cycle means cutting your expenses.
By eliminating debt (especially credit card debt and auto loan payments) you’ll have more room in your budget to absorb small emergencies like a car repair, your kid suddenly growing three shoe sizes, or a medical bill.
5. Be Dramatic About Cutting Expenses
Sick and tired of living in the check-to-check cycle? If so, dramatically cutting expenses (to the point of discomfort) could be a online installment loans Nevada good move at least for a short time.
Move back home with your parents or another relative (even if you’ve got a kid), take on a few roommates (if you own your house), arrange your work schedule so you and your partner work opposite shifts and don’t have to pay for child care, sell your car and walk, bike or take public transit everywhere, get rid of your smartphone and drop to a call-and-text-only plan, never eat out (literally), and the list goes on.
Obviously, not all these suggestions apply in every circumstance, but they may all be worth considering for a period of time. This dramatic downshift in spending isn’t comfortable, but it doesn’t have to be forever. Instead, you can drop your spending for a few months or a year while you grow your income, save money, and break the check-to-check cycle for good.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site .
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.