Although the economy and personal financial situations of some Americans are improving, some households say they are still living paycheck to paycheck. Unfortunately, this can leave little room for unexpected expenses.
According to a recent survey from localcashhelp.com cash advances bad credit, 40 percent of American households are living paycheck to paycheck. While this may seem like a significant share of families, it was a notable decline from the post-recession high of 46 percent experienced in 2022.
Nearly 72 percent of workers say they have become more fiscally responsible in recent years, Haefner added. If the job market continues to build momentum in the near future, this could allow households to grow their incomes and free up more money to put toward necessary expenses.
Meanwhile, 37 percent of respondents revealed they sometimes live paycheck to paycheck, while 23 percent claim this is never an issue, the survey indicated. Not unexpectedly, the lowest percentage of households having difficulty making ends meet earn more than $100,000 every year. However, 12 percent of these families still claim they are forced to wait for their next payday to make expenses.
In an effort to make their budgets work, 59 percent of respondents said they have cut out leisure expenses since the start of the recession. But there are still some costs that few households are willing to give up.
Specifically, 57 percent of families said they would never give up paying for internet connectivity, regardless of their financial situation. In addition, 44 percent said they would not stop paying expenses on their automobiles, such as gasoline, insurance and maintenance.
Other areas many households are refusing to cut back on include pets, cable television and phone service, the survey found.
For households finding themselves falling behind on monthly expenses, it’s time to learn some basics about budgeting for a family.
Budgeting Basics
Some people believe if their income matches their household expenses, they have a balanced budget. While this can work in the short-term, it means you will have to work forever, since you won’t be saving any money.
To start cutting back on your spending, take a couple months to account for where all your money is going. Even if you make a small expense, such as buying a cup of coffee, include this in your record keeping. Once you have an idea of your monthly expenses, you should separate them into necessary and luxury spending.
This is where you need to be realistic. Consider costs, such as rent, food and debt payments as necessities. Although you might cherish certain goods and services, at the end of the day, they may not count as necessities. Reduce the amount of money you funnel to these expenses, and you may be able to escape the routine of living paycheck to paycheck.