I’m not going to lie to you. If you’re living paycheck to paycheck, getting ahead of your money is not going to be easy. But it can be fairly quick. In fact, I’m pretty sure that many of you can get ahead of your money in 56 days or less. Why 56 days? Because if you target 60 days and really get intense you’ll finish at least 4 days ahead of schedule. We’re not talking about being “debt free” or finding financial freedom here. We’re just catching up and getting ahead of our paychecks.
Of course, if you’re suffering through a financial emergency like many other folks, it can feel impossible but that’s OK. Here’s a few quick tips for getting ahead of your money.
Let’s have a little fun with this and then I’ll follow up with some more tips in other posts. But these tips should be tough, but fun. Some of them will make you think “no way.” Those are ones you should consider first. Those will make you feel good after a week or two.
So continue to pay your bills, but with the rest of the money here are a few fun ideas to help you catch up (I apologize in advance for the length of this post, but my fingers just kept on moving!):
Go on a spending strike! Picket if you want to (but make sure you have a permit if you actually picket)!
For the next 30 days, just stop spending money. Easy, right? I know, it’s not that easy. You have to eat and pay your bills, right? But sit down and plan your meals for the next 30 days. It will take a few hours or you could just work your way through 100 Meals for $5 or Less or Cheap. Fast. Good!
Just stop buying “stuff.” Pile up the money you don’t spend.
If you want to have some fun with it, make a “Spending Strike” picket. Make a bunch of them with your friends and family and, instead of going on a spending trip, march around your house, back yard or the local mall. (Just make sure if you “go live” with this you consult the local authorities so you’re not violating some law. Remember, this is not “advice” but just some fun concepts!).
Have a yard sale (or two, or three, or four)!
Sell some “stuff.” Sell a whole bunch of “stuff.” Sell everything that you don’t “need.” Yes, actually “need.” Then keep selling.
Add the money to your pile. That’s right, you now have a pile of money. Pretty cool, huh? Feel free to actually pile it up (out of site of the window, of course, but it’s fun and encouraging to have a pile of money…)
Shred your credit cards!
Yes. Consider literally shredding your credit cards (not cancelling the accounts, just shredding your cards).
Deep breaths. It’s OK. You can always call up and get a new one sent to you. If you’re a “really good” customer (READ: a really big spender) they would probably overnight you one for free if you ask. But shred them and wait a week or two (or more if you can) before you call and get new ones. If and when you call and get new ones, wait a week between requests. So request one and then wait a week.
This one probably makes you cringe. What if there is an emergency?!?!?! Well then shred every one except for one. Give that one to someone you trust who does not live with you. Tell them what you’re doing and that you need them to hold your “emergency card.” Then your one card is only a phone call away (but one that gives you some accountability).
(For those readers who say you should have an emergency fund, I agree, but this is directed to those living paycheck to paycheck, who likely do not. After a few yard sales and a spending strike or two, however, they will hopefully get ahead of their money and have an emergency fund. When they do that, they can consider shredding the last card!).
Become a professional negotiator!
Credit card debt? High interest rates? Call up and ask them to lower your rate. Just do it. Be nice and say you’re trying to pay down some debt and are hoping they can help by lowering the rate. If they say no, that’s OK. You tried. Hang up and call right back. You’ll get someone else on the phone. Try it with them. If they say no, hang up and try again. (I’m not sure how many times you can do this before they “catch on” but usually within one or two requests you get someone who is nice and wants to help you out.)
And negotiate when you spend. (This one is in addition to the spending strike – negotiate the price of whatever you actually need. Don’t feel embarrassed. It’s totally OK. Almost every price is negotiable, even at big box stores.)
I remember going into Nordstroms with my mother-in-law, who was shopping for a “fancy purse” (my quotations, not hers). She found one that she wanted and it was $400.00. She was ready to buy it but I begged her to go to the register and say “this is a really nice purse, but it’s very expensive. I really want to buy it, but can’t justify the cost. Is there any chance you have any coupons or other discounts you could apply to my order?” $75.00 off! That’s right – $75.00 for three sentences! She was amazed.
(I also recently saved her $900.00 on a cruise with one phone call. Pretty cool, huh?)
Get a second or third job!
I know unemployment is high and they’re not handing jobs out on every corner. But if you’re living paycheck to paycheck one thing that could help is another paycheck! And pile up that money! Now you should have a really big pile!
Here are three non-traditional ideas to find an additional income (I’ll elaborate on these in separate posts. They really do deserve more detail on their own):
- Baby-sit for friends, family or strangers;
- Rent out a room (or two or three) in your house; and
- Reduce spending (or generate profits) by volunteering (or working) where you would normally spend.
And finally:
Remember: There is no “easy way out.”
This one is not “fun” or even a tip, really. But having the right mentality and expectations are key. Just remember that you’re [insert age here] years old. You didn’t get here overnight. But in a couple of months with the right mentality and intensity you can start to fight back and even get ahead.
Here’s a little more detail on this one:
Many people ask me how to get out of debt. It’s really simple: Pay off all the companies and people you owe and then spend less than you make going forward. This is similar to that. There is no easy fix.
There can be “quick” fixes, but not many “easy” fixes really. If your mortgage is too high and you’re under water, for example, it’s tough. You could do a short sale or something else that could torpedo your credit score. But if you can “afford” the payments I’m a big believer in honoring your word, no matter how bad the deal. So you would need to figure out how to defray some of the costs that you can’t control (like renting out rooms to make your house affordable).
You could also negotiate the principal down on some debts (like credit cards) if you’re late in payments. But I don’t believe you should stop paying just to try to negotiate it down for a number of reasons. It will kill your credit score for one. You may have to pay taxes on the savings anyhow (so the true savings would be much less and you end up owing the IRS – not someone you want chasing after you, because they’ll get you, I promise). And it’s against what I believe in. I believe in keeping promises. I also believe in paying the piper when my decisions turn out to be the wrong ones.
So even if “but for” the economy you would be fine, don’t blame the economy. You’ll be stuck mentally. Take responsibility and control. You can get ahead of your paycheck, but it will involve cutting spending and finding money. Be creative! Touch base in 56 days to let me know how you did it!
And, of course, put your credit card down and slowly step away from the mall!
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