Budgeting: How can I afford to live on my wages?

By November 16, 2018 Uncategorized

Have you ever called in because you didn’t have enough gas to get to work? Have you ever missed a meal because you were short on funds? Although only 40% of Americans regularly use a budget, if you want to stop struggling, you have to take control of your money.

Budgeting when you live paycheck to paycheck seems impossible. Most days it feels like you spend more than you make, and the bills still aren’t paid. You work hard and pay what you can when you have it, but how can you ever get ahead? The answer is, you need a plan.

How to Budget Basically

  • The first place to start when making a budget is to figure out what you earn. Your hours at work may fluctuate, but looking back over the past three months, add up your paychecks. Whether you are paid weekly, bi-weekly or monthly, divide the total by the number of times you were paid. This is your average pay — your starting point.
  • It all goes to bills, right? It may feel that way, but everyone has a spending blindspot. Start with the bills, even the ones that change each month. Average your utilities as you did your pay. Subtract your bills from your income. Do you have anything left? If not, its time to make cuts. If so, it’s time to plan where the rest goes.
  • If you do not have money, or not very much, left over, it’s time to cut back.
    • Housing is not negotiable unless you are able to move to somewhere more affordable. That said, moving is expensive, so we need to look elsewhere.
    • Cable or satellite can be canceled or reduced if you have a contract.
    • Cellphones are the same; if you are out of your contract, try switching to a prepaid plan to save money.
    • If you have bundled services, such as cable, phone and internet, can you move to internet only? Why have a landline and a cell phone? You can stream media on the internet rather than pay for cable.
    • Manager usage to save on utility costs. Save a few dollars each month with small changes.
    • If you have a car payment, check with your lender about discounts for a direct withdrawal for the payment. If you pay weekly, will they give you a discount for paying monthly or vice versa? Can you reduce your car insurance bill by switching providers or lowering coverages?
  • If you can’t lower your bills, you will need to increase your income. This may include a second job or seeking services, such as WIC or SNAP. Even if temporary, these services can help you level out until your budget fully takes effect.
  • If you have money leftover, you will need to take charge of where your money goes. Review your previous months’ spending: Do you eat out regularly? Do you buy convenience meals? Do you spend extra money on things which poorly affect your health, such as cigarettes, alcohol or other substances? We aren’t judging, but these items can put a strain on your budget. Cutting back is an option here as well.

Your finances may seem out of control and overwhelming, but stop where you are and make a plan. This is financial survival. If you don’t make a plan, you will not make it. Eventually, something will catch up to you, an eviction, traffic ticket, small claims court or garnishment. Starting now, you can do something to fix your situation.

Figure out the method that works best for you. Mint.com is a safe, easy way to manage your finances and budget. There are many apps such as Wally, Albert, Prism and Acorns that can help you monitor your spending at a glance. And, of course, there are always the tried and true methods of spreadsheets, envelopes, zero balance – there are many budgets out there. The most important thing is making a plan you can stick to.

As an Ōnin Teammate, you have access to our Employee Assistance Program, which includes an online financial tool and in-person financial counseling services. For more information, call or visit your local Ōnin Staffing office today.

Determine the things you can’t change and adjust the things you can. Commit to paying every bill on time. Debt is not the answer to your situation.

Avoid the trap of payday loans, which cause a vicious cycle of borrowing at rates over 200%. Most loan places encourage you to stay with them by offering to renew your loan & pay you cash back on what you already paid. You extend the amount of time you will be paying on the loan, thus causing interest to accrue and your total debt to rise. These types of loans are illegal in many states, including New York, for good reason. It’s best to stay away from such temporary solutions.

A budget is not glamorous, but it will help you improve your finances and make your life better. Starting a new budget is tough. Be clear with your family about the plan and stick to it. You are in charge of your future.

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