The article gives a detailed analysis of 4 Personal Finance Tips to Avoid Running Out of Money Each Month.
Personal Finance Advice for People Living Paycheck to Paycheck
Most people lead life on a day-to-day basis and financially they are on a paycheck to paycheck existence or rather subsistence. These are the people who are out of money several days before pay day and the problem is recurring without any recourse in sight. The main reasons why people live paycheck to paycheck are because they do not budget properly and they also tend to spend more than they earn. Unless these crucial issues are addressed, the situation will remain bleak.
Budgeting is very important, and what’s more important is, sticking to the budget failing which there is no way of keeping track of where the money is going. The best thing to do would be, to keep track of every single purchase. It doesn’t matter if it is a small insignificant parking garage fee or something large like an expensive television.
The best way a person can remember all purchases is to update the budget at the end of the day. Carrying a small note book to jot down every penny spent would help. At the end of the day checking what the position is and whether the budget for the day has been exceeded or not will help plan the next day’s expenditure.
Ignoring an issue or a task is not going to help getting rid of it. There is no point in creating a budget and not updating it honestly. Just because keeping track of expenses clearly gives the message that expenses are going out of control does not mean that one should stop keeping track.
That defeats the very purpose. It would be better to go through the purchases for the day and check which one of them is not justified at all and avoid that from the next time. That is at least one step in the right direction. Budgeting will give a clear warning when one needs to stop – spending. Once a person has control over that, half the work is done.
More often than not, people get caught in a trap where the carefully planned budget goes for a toss. For instance, it could have been a simple Saturday night plan at the bar with friends. However, as the night progresses the plan would extend for a couple of more drinks and then eating out. In such instances it would be very difficult to refuse and play spoilsport and the person gets drawn into the excitement (with the drinks helping speedup decisions) and ends up spending more than planned.
The best at such times would be, to abstain and refrain from getting into such situations. It is good to remember that budgeting is like dieting and there is only a thin line in between. Scrounging too much could lead to an unnecessary spending spree followed by a financial mess.
While exceeding the budget once in a way is alright, it is important to keep track of spending. If it is too difficult doing it on your own, requesting a partner or friend to help by keeping track and reminding at appropriate times would help. If that proves to be too embarrassing, one could turn to various governmental agencies or nonprofit organizations that offer credit counseling, debt management and money management assistance.