Financial Freedom: How to Break the Paycheck-to-Paycheck Pattern

Financial Freedom: How to Break the Paycheck-to-Paycheck Pattern

Payday is coming up, but instead of feeling excited because you’ll have money to put into your wallet, you’re more worried about budgeting it. You’ll only feel a little relieved after accounting for your expenses and finding that you’ll be left with some cash that’s good for at least a couple of days. If you can relate to this kind of scenario, then you’re probably living paycheck-to-paycheck.

This kind of cycle may happen if you’re the breadwinner in your family—since you’re in charge of household expenses, most of your salary is spent paying the bills. 

Spending your money on unnecessary expenses because you want to experience life to its fullest—also known as the “You Only Live Once” mentality—is another reason why you may be having difficulty managing your finances.

Financial freedom isn’t impossible to achieve, but first, you need to break the cycle of living paycheck-to-paycheck. Here are some financial tips to help you in this goal:

Break the Paycheck-to-Paycheck Pattern

  1. Organize your savings and expenses

Expenses are part of everyday living. But as you make a budget for things you need to pay for, don’t forget about your savings, too. In fact, prioritizing savings instead of setting aside money for expenses is a must-do financial habit that you should work on. By minimizing your expenditures and saving money regularly, your finances will slowly but surely improve. 

So if you find yourself checking out your online shopping cart every payday, break this habit right away. Uninstall your mobile shopping apps, and replace them with a mobile banking app instead. Set up your mobile banking app in such a way that it automatically transfers a portion of your salary to your savings account.

Or, if you feel more motivated physically counting your money and putting some of it towards savings, you can use the envelope system of budgeting. Whatever method of saving you choose, the important thing is to get started as soon as possible and be consistent in saving.

  1. Maximize the use of loyalty and rewards app

With the rising prices of basic commodities like food, clothing, and medicine, you may find your cost of living expenses going up. This kind of problem can definitely affect your capacity to save, but this shouldn’t stop you from aiming for your savings goals. You only need to make wise choices as a consumer.

Start by being a practical shopper. Make sure to buy quality products that you can afford instead of purchasing from popular brands, even if it means that you’ll be spending more.

You can also check your eligibility to avail any loyalty or rewards programs from the mobile apps you use. Among businesses with mobile apps, Cashalo can be your best friend if you’re looking for the best deals online. Since the Cashalo credit app offers exclusive discounts for its users, you’ll be able to save by paying less for essential purchases. 

  1. Look for a side hustle

It will be easier to move away from the paycheck-to-paycheck kind of living if you have other ways to make money aside from your 9-to-5 job. It’s a good thing that there are quite a lot of freelance job websites where you can find possible work opportunities. You can choose whichever freelance work suits your schedule, so you don’t have to make significant adjustments to your day-to-day tasks.

If you’re interested in managing your own business, you can also sell goods or even your skills by putting up an online shop. Since this kind of business has a broad market—with a lot of people choosing to buy online now more than ever—you can potentially earn more money, too. You can also make a living using a mobile phone

Just make sure not to spend any of your hard-earned money in a snap of a finger, the idea is for you to save 100% of your earnings from your side hustle.

  1. Set up a savings account that has twice your salary

Knowing the importance of saving money is a good start to stop the cycle of running a deficit payday after payday. However, it’s equally vital that you set particular goals so that you’ll know exactly what you need to do to succeed.

Challenge yourself to build a savings fund that’s worth twice your salary. If you’re earning P15,000 monthly, your savings account should have P30,000 in it. Put your extra income, work performance incentives, salary increase, or holiday pay into your savings account, and before you know it, you’ve already built an adequate amount of savings. 

Remember, this amount should stay in the bank and must not be used for any debit transactions. 

A Step Closer to Financial Freedom!

Financial freedom is an elusive dream if you’re living paycheck to paycheck, but it’s possible to break this cycle. It may be hard at first, but as cliché as it sounds, you’ll have a more difficult time if you keep postponing your financial management plans. 

Review your money habits and make the necessary changes that will enable you to save more and spend less. Cashalo’s Shop Now and Pay Later services give you exclusive discounts with partner merchants, bringing you a step closer to be free from your financial problems.

Check out Cashalo’s Buy Now and Pay Later by downloading the Cashalo credit app and score exclusive perks and discounts!