Why You’re Always Broke

Do you live paycheck to paycheck? A lot of people do.

Frankly I don’t know how people afford to live. Folks have a lot of payments they have to make AND they have to feed themselves and their kids.

I am single so life is pretty simple.

One of the reasons I choose to live a minimalist lifestyle is to not spend money on useless crap. If I want something I save and pay cash.

Most people don’t do this. They pay on credit and then end up on the credit treadmill. Never paying off their balance and thus paying super high interest.

So what about your paycheck or how much you make at your job.

Most people think that life would be so much better if they made more money.

Let’s take a look at that.

First of all you have to look at real income. How much does your job cost you to be there? Your commute, clothing, gas, car payment, etc.

This is going to upset you.

If you make 45000.00$ per year, your real income is probably less than minimum wage. Sit down and figure it out.

Here is another way to figure it out. Take your gross salary, drop the zeros, divide it in two, and this gives you your gross hourly wage. You take home about 2/3 of that.

Starting to see the problem?

The other part of this is that you have too many payments.

Mortgage(how much will you have “paid” for your house when it’s paid off?)

Cell phones, internet, cable.

Car payment(plus interest).

Various other credit cards.

There just isn’t enough money to go around is there?

So what does your personal balance sheet look like?

Assets on one side, liabilities on the other. And your house is a liability until it is paid off!! Even then it costs you money in the form of taxes and maintenance.

How do we correct this?

First off, buy less stuff! I am not saying that you have to live a minimalist lifestyle(but it does make life a lot easier!), but just look at how much stuff you have and how much you spend on a weekly basis. Five dollars a day is 150.00 a month. If I asked you for 150.00$ every month you’d laugh. But this is what some of you are spending on coffee, doughnuts, chips, etc.

And what if you smoke?! Good grief. Why not just let me punch you in the face for a few minutes a day? It would be cheaper. Sorry, I digress.

You need to cancel all things that are frivolous expenses until all debt is paid off.

How dare you complain about not “making” enough money and yet continue to have a cell phone or gym membership!(These are just examples)

Leave your debit/credit cards at home. If you have them you will find a reason(excuse) to spend money.

These fairly basic money management skills are lost on most people. They have no idea how much they make or how much they owe. Just bury your head in the sand.

Why is it that a lot of folks just do not want to look at their personal finances and come up with an aggressive plan to get out of debt. If they took the necessary steps it really would not take that long.

Of course you should stop going further into debt as well.

Your paycheck is not the problem.

It is not how much money you make but the decisions you make with that money that determine your financial health.

You can stop living paycheck to paycheck. Sit down and start planning how you are going to do this. Now.

Please share this with others and feel free to comment.


“Live Simply”


5 thoughts on “Living Paycheck To Paycheck

  1. What you say makes ALOT of sense. I was lucky even at a young age in the 1960’s I was taught to live on the 80 10 10 principal. You pay your bills with 80% of your net income; 10% goes to charity and 10% goes to savings. You don’t touch the savings unless it’s a life or death emergency. The only debt I have is my home. You look at what you “need” and what you “want” and they aren’t the same thing. I have a cell phone but it’s a pay as you go – costs 10 cents a minute to use so it’s for emergency only. No cable tv and no going out for movies. You can see alot of cable shows on the internet now. Movies – buy the dvd on ebay or trade with friends and coworkers. You just have to decide if you want to keep up with the Joneses or if you want to be able to not work at 60 and not worry about money if you get laid off/fired. By sticking to the 80 10 10 principal I have the money to buy rental properties, keep my bills paid etc. I do use credit cards but it’s for convenience and they are paid off every month. Try doing the 80 10 10 – it will be hard the first year but after that it will be a habit and you will be surprised how fast your bank account grows.

    1. Excellent comment. I am trying to be a bit more aggressive with my investment plan as I am starting over after my divorce. Living on 50% and investing the other 50% of my income. It is actually very simple and painless. I want for nothing and still enjoy a wonderful life.

      Wants VS Needs. So true. But not many people get it.

      Thanks so much for commenting:)

    2. I was taught with 50-30-20 principle.
      Expenses would include 50% of take home salary.
      Savings is 30% , 20% is pay back to scoiety , charity , kids career.
      Never go for debt until and unless if its asset creation , then loan is acceptable.
      This still works …………..provided

  2. This is really interesting! I don’t think you’ve considered the human factor, but still a good post.

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