5 tips to avoid living paycheque to paycheque
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By Bromwich+Smith Staff | 711 words | Reading Time: 3 minutes and 5 seconds | Date: 2022/08/09
Many Canadians are feeling the burden from rising inflation rates. After they have paid their mortgage or rent, stocked the pantry, fueled the car and paid their bills there isn’t much left. Many are relying on overextending credit to get through to the next pay day. Studies show that nearly 40% of Canadians are living paycheque to paycheque.
How can I avoid living paycheque to paycheque?
- Create a budget
When it comes to talking about money, budgeting is often the first question. Do you have a budget? Do you stick to a budget? By having a budget in place you can see how much you are bringing in and where it is being spent. You may need to review your spending habits with a budget planner.
- Asses your spending
Once you know how your money is being spent, you can look at what makes the most sense for your situation. Do you need to look for room mates or possibly look for housing with lower costs in general. Are you spending a huge portion of your income on entertaining or eating out? Or is a large portion going towards debt and interest. You may consider talking to a debt counsellor, or look into debt relief options.
- Early Wage Access
Payroll software agencies across Canada are trying to lessen the pinch by offering “early wage access”. This allows individuals to sign up through a third party service offered by their own employer to gain early access to wages they have earned but not yet received. This is not considered an advancement or a loan as the employee would have already earned the money through hours worked. This program offers clients with a payment card to be utilized like a prepaid credit card. There are fees associated to the card, typically a per use dollar amount but no interest is accrued.
- Side Hustle
We are hearing the term “side hustle”, more frequently these days. When the pandemic hit and businesses started to close many Canadians found themselves in a situation beyond anything we could have anticipated. Some found part time jobs, others turned a passion into an income. If you often find yourself living above your current financial means, adding additional income may be a solution.
Do you love to crochet? Look at making an Etsy account! Do you have kids looking for playdates, maybe look into offering childcare. Do you love to shop but your credit cards are begging you to stop? Maybe a part time job at your favorite retailer is an option for you. While a side gig can help generate additional income and help with debt relief make sure you are able to take on the extra work and know what the up front costs of a new business may be!
- Look Forward
It may be hard to think of the future now, but by taking the time to put money into a savings account you are taking care of future problems. You may have heard the expression “when it rains, it pours”, and more often than not we find ourselves in financial situations when we feel like we cant handle it. “Murphy’s Law”, you just went on holidays and your hot water tank broke. You may get laid off and your landlord lets you know they are selling, and you need to look for a new place to live. Whatever the situation, when we are already living paycheque to paycheque any added expense feels like a breaking point. By planning ahead and putting away even a few dollars every pay day will help set you up for future success!
There are so many reasons why you might be living paycheque to paycheque, but just because its your present doesn’t mean it needs to be your future!
Bromwich+Smith has a number of debt relief strategies to help you regain control of your finances and get your life back on track. Reach out today for a free, confidential, no obligation consultation. Bromwich+Smith’s Debt Relief Specialists are available by phone at 1.855.884.9243, or request a call back at contact us page. We want to see you flourish!