10 Ways to Save Money When You're Living Paycheck to Paycheck (2024)

Do you find yourself constantly living from paycheck to paycheck, with no financial freedom in sight? Are you frequently stressed about your lack of savings, inability to pay off debt or bills, or frustration over not being able to afford even small luxuries?

When living in this cycle, it can feel like it is impossible to ever have financial security. But with a lot of hard work, some guidance, and the motivation, you can break the cycle of living paycheck to paycheck and save money. Here’s how.

1) Open a Dedicated Savings Account

In order to save money, opening a separate savings account is a must. This step is vital. So often, though we may have the best intentions, we spend any money that is in our regular savings or checking account that we intended to save.

The trick here is to deliberately make this savings account a little difficult to access. Keep in mind, we aren’t talking about a Swiss bank account, but rather having a separate account that you do not have a debit card or checkbook assigned to. By keeping it separate, you prevent yourself from seeing that money too often and remove the temptation to spend it. Many people highly recommend opening an online savings account, like Discover.

2) Negotiate Your Bills

Common bills, like internet, car insurance, cellphones, and credit cards, can often be talked down from the rates they offer. It never hurts to try to negotiate these rates, especially if you find that they are continually increasing.

Unless you are in a contract, cell phones and internet/cable bills frequently increase their rates with no prior warning to you. It’s important to call to ask what the reason for the increase was, and to let them know you have done research about providers who offer a much lower rate. 9 times out of 10, you can negotiate a lower rate, which saves you money.

Other bills, like car insurance and credit cards, are more likely to work with you if you are a loyal customer. If you are paying off credit card debt, calling your credit card company to see if they could lower your interest rate could save you hundreds, if not more.

3) Sell Household Items

To break the cycle of living paycheck to paycheck, it is necessary to build a buffer. A buffer protects you from ever having your bank account get to $0, or worse, overdrafting. The size of a buffer is of individual preference, but even a few hundred of dollars extra can prevent you from having to pay bank fees for an overdraft.

One of the easiest and quickest ways to build this buffer is to sell items around your home. Most of us, unless you have already adopted an extremely minimalist lifestyle, have household items sitting around that we no longer need or use. You can easily sell these items to earn some quick cash.

Selling items has never been easier. You can post pictures and a description of an item on Craigslist, OfferUp, or various buy, sell, and trade Facebook groups.

4) Create Additional Income Streams

In order to truly break the cycle of living paycheck to paycheck, you need to be able to ensure that you always have enough in savings and that you always have enough income. Creating additional income streams helps to protect your finances and keep you on the right track financially.

Anyone who currently has additional income streams will tell you how, not only do they enjoy the benefit of earning extra cash right now, but one of the biggest bonuses of having an additional stream of income is the protection it offers. If you ever lost your job or found that you were not able to work in a traditional environment, what would you do? Though there are assistance programs for situations like this, the best thing you can do is to protect yourself financially by creating other options for yourself.

The beauty of earning extra income is it can be something you truly enjoy. My passion is writing, so I started a blog and my own freelance writing business. Some people enjoy photography, mowing lawns, digital design, or something else, so they earn thousands of dollars extra every year doing that. Building extra streams of income not only helps break the cycle of living paycheck to paycheck, but it gives you security, career options, and enjoyment as well.

5) Slash Services

Paying for services is expensive, and most of the time, these services tend to be luxuries rather than necessities. Slashing out services like cable, regular salon appointments, or cleaning services will help you save money every month.

If you subscribe to a service, it’s usually because it is something you truly enjoy, so it can be difficult to cut. It’s important to remember that, while these services may squeeze into your monthly budget, you are missing out on opportunity to save as much money as you should be to break the cycle of living paycheck to paycheck.

6) Create a Savings Plan

Creating a savings plan is vital to break the cycle of living paycheck to paycheck. Without one, it can be too easy to find another use for your money instead of saving it. So create a savings plan that works for you.

From my experience, I find the easiest and most successful way to save is to automate it. Every pay period, I have my direct deposit set up to automatically put money into my separate savings account. This way, I don’t even have to think about it. When you have a plan and don’t touch your savings, it’s amazing how quickly it can build.

7) Find Accountability

Money shouldn’t have to be a taboo subject, especially considering how many people struggle to make ends meet. Accountability is perhaps the most underrated tool in achieving financial success.

Talk about your situation with a friend, spouse, or family member. Find someone who will keep you accountable and ask about your savings goals. For millennials, many of us can budget okay until a social event comes up where we hate to say no. Having a friend who will hold you accountable, and maybe even say no to an event with you will get you all the further in your financial journey.

8) Go on a Spending Fast

If you want to free yourself from living paycheck to paycheck quickly, you will need to push yourself. One way to do that is to go on a spending fast.

A spending fast is a period of time you go without spending money on any non-necessities. This means you don’t go out to eat, shop, go to concerts, travel, or anything that isn’t necessary. It might seem drastic, but it is one way to heavily decrease your spending, resulting in more money you can put into savings.

9) Reduce, Reuse, Recycle

If a spending fast seems too extreme for you, keep reduce, reuse, and recycle in mind. So much of our money is spent purchasing items that we think we need, but that bring us no joy. Though frugality likely won’t make you wealthy, it can create space in your budget so you can save more money, which is exactly what we are trying to do here.

This technique will require you to lessen your expectations and get a little creative. Figure out how you can use the vegetable you’re about to throw out. Take time to closely look at your wardrobe to find some new outfits with clothes you already have. Shut off the lights when you leave the house.

10) Be Consistent

Keep in mind, it could take several months of doing all of these steps consistently to be able to save a significant amount and break the cycle of being broke. Hold yourself accountable to follow these guidelines and save as much money as you can. The payoff is worth it.

Have you broken the cycle of living paycheck to paycheck? What tips did you use to get your financial life in order? If you’re currently living paycheck to paycheck, what is your experience with trying any of these tips?