How To Get Out Of Debt Living Paycheck To Paycheck

paycheck to paycheck How To Get Out Of Debt Living Paycheck To Paycheck

Living with debt can be extremely embarrassing. If you’re living paycheck to paycheck, it can seem like you’re the only one with money issues. In addition, you can’t figure out how your friends can afford their cars and vacations when you make the same amount of money. I’m here to tell you that most of your friends are in debt – just like you.

I want to offer you hope that there is a way to get out of debt and live the life you deserve. I will help you break your focus from your monthly payments and credit card balances – to a vision of the life you deserve.

This article will show you how to make payments that actually help you cut debt out of your life rather than trying to find a low interest, “quick fix” way out of your mess.

What It Means To Live Paycheck To Paycheck

living paycheck to paycheck

If you are living paycheck to paycheck, that means there is no extra money in between paychecks. If you’re lucky, you are able to make the minimum payment on all your high interest credit cards and your never-ending student loan debt. If not, your credit card payments are too much for your income and you’re spending more than you make.

Late payment fees and payday loans may be your routine and it’s starting to get out of hand. You take on new debt each month because you are required to put your groceries on your credit card. You then have to wait until next month so you can pay for your groceries for this month.

The danger with living paycheck to paycheck comes when a contingency arises. First off, you don’t even have money to pay your existing debts. During this contingency, you’re adding up even more debt to that which you already have. It then becomes the start of a never-ending cycle of debt. Hence the need for you to prioritize getting out of debt ASAP before interests accumulate to the point where you’ll end up owing way more than you initially took out.

You Deserve Better

We should not be living on credit and barely surviving. However, this fact still remains true even when you feel that there’s never enough to get by in a month. Whether you’ve got a substantial salary, or even if it’s only so little, there are many ways to make it through, without necessarily falling into debt over and over again. I want to help you shift your mindset in order to experience debt freedom without getting that second job if we can avoid it.

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    Your current financial position is putting you in a position to fail for the rest of your life. Living paycheck to paycheck means that if your vehicle breaks down, there’s no way you can pay for the repair unless you put it on a credit card. Credit cards are constantly “saving” you and allowing you to buy the necessary items you don’t have cash for. After reading through this, you’ll come to realize that you don’t need to rely on credit cards anymore — a change in lifestyle and perspective can.

    So far you may have been able to keep your head above water but it is not going to last long. If you find yourself slowly drowning, I’m here to offer you hope. There is a way out of this mess, I promise!

    The Best Advice I Have Ever Heard

    The best debt advice I ever heard was to avoid it at all costs. Today I will show you a debt solution that you can do on your own without any expensive programs. We will use your monthly income to attack your credit card debt as fast as possible.

    Before we begin, there is one thing you must know.

    There is no such thing as good debt. All debt should be looked at as bad debt because it subjects you to pay unnecessary interest payments to the lender. Some may argue that a mortgage is “good debt” but in reality, you are still a slave to the lender.

    If you count the interest only as you pay for it in the month, it may not feel like it’s adding up too much. But, in the long run, you’ll realize that all that money spent on interest payments could’ve been spent on better investments or even saved up.

    This article will help you pay off debts even if you feel like you have no money. With the right direction and plan, you can get out of debt without paying for an expensive debt management program or other “debt solutions.”

    You Are The Secret To Get Out Of Debt

    the best advice to get out of debt

    I’m going to let you in on a little secret.

    You are the key to fixing all of your money issues. You don’t need to be a personal finance expert to realize you have debt problems. I’m going to show you where the lock to your financial freedom is how you alone can turn the key. 

    You shouldn’t have to worry about putting food on the table or having enough money to keep the lights on. You work too hard to be this stressed.

    You obviously have the motivation and desire to put an end to this “hopeless” situation. Your own confidence is the biggest challenge!

    I know you have the skills and ability to get out of debt, you just need a plan and guidance to get it done!

    Be wary of people who say they can help you get out of debt “quickly” if you consolidate your loans with them or refinance etc. Student loan consolidation and loan consolidation, in general, is not necessarily the best route. There is no secret to get out of debt quickly and most of these scams will leave you with an even bigger debt problem.

    Get Out Of Debt By Saying “No” To Debt

    In order to start to process, you need to be all in and refuse to live like this anymore. Debt is not your friend, it is your enemy. By changing our view on debt, we can avoid it at all costs and see other options to get what we desire.

    Despite what the world tells you, no debt is good debt. Some amount of debt may seem necessary, such as a mortgage or car payment, but even these are not good debts. When you owe money, someone else is in control of you and your finances.

    If you don’t pay your mortgage or car payment, the lender will take them away from you and leave you on the street. This amount of power should not be given to anyone, let alone someone who wants your money.

    When you start to look at credit cards, student debt, mortgage debt, and vehicle loans as having a negative impact on your life, you can start to understand how to avoid the pain.

    You Can Get Out Of Debt No Matter How Bad It Is

    Your situation is not unique. People have been in your shoes and owed as much as you do – and still were able to get out of debt by following a plan. There are several tactics that you can use to change your current money situation but none of them are quick and easy. It will require hard work and patience to make this transformation.

    But it is totally worth it!

    Think back over your life. Have shortcuts and quick fixes ever worked in the long run? Chances are the duct tape fix didn’t last long and neither did any other quick fix.

    Things that are worth the most require a good deal of time and hard work. When you finally fix that problem the right way, it is fixed for good and you can sit back and relax instead of wondering when it will break.

    Take These Steps To Get Out Of Debt

    steps to get out of debt

    If you follow these steps, they will begin to set the foundation for your debt-free life. No more charging your diapers on a credit card with the hope of being able to pay the bill next month.

    I don’t want you to just manage your debt, I want you to be able to live without it! It’s time you got your hard earned cash back in your pocket.

    To Break It Down, These Are The Steps To Get Out Of Debt:

    1. Refuse To Use Your Credit Cards
    2. Create A Budget That Actually Works
    3. Separate Your Needs From Your Wants To Get Out Of Debt
    4. Check Your Credit Report To Find All Of Your Debt
    5. Build An Emergency Fund Before You Pay Off Debt
    6. Use The Debt Avalanche Or Debt Snowball Method To Pay Off Debt
    7. Negotiate With Credit Card Companies To Settle Your Debt
    8. Increase Your Income To Get Out Of Debt
    9. Save Money On Everyday Purchases

    1. Refuse To Use Your Credit Cards

    Credit cards charge the highest interest rate to loan you money (except for payday loans) and they leave you with credit card bills at the end of the month. Credit card interest has a way of snowballing out of control leaving you with a feeling of hopelessness.

    Starting right now, refuse to put anything else on a credit card. The credit card company has taken enough of your money. I don’t care where you are in the month, the bleeding needs to stop.

    What better day than today? If you have a week left and no food in the house, find something to sell or pick up an extra shift at work. Putting those groceries on a credit card will only push the start of this process off until next month.

    At some point, you will need to stop accumulating more debt. Stop making excuses for why you will start next month. Adding more debt needs to stop today. You are resilient and have lived this long, find another way to pay for your needs without borrowing money.

    Truth Bomb: Credit Cards Are Your Enemy

    A credit card is someone else’s money that you borrow and promise to pay back with interest. Things are expensive enough, don’t make it worse by adding interest on top of an already expensive item.

    When you use a credit card, you are borrowing money. Wouldn’t it be nice if you were the one with the extra money and people were paying you to borrow it?

    Stick with this process to pay them off, and you will be the one with the extra money.

    If you are wondering if you should get a debt consolidation loan, check out this article I wrote about debt settlement and debt reduction options.

    2. Create A Budget That Actually Works

    Budgets are like diets. Usually, everyone has tried one but few people can actually stick to it. The problem comes when people start a budget and are too hard on themselves. You start a budget with good intentions but actually sticking to it can be extremely difficult.

    Thankfully, there are now so many ways to come up with a monthly budget, whether it be for your personal expenses or your business. There are various software that can help you, such as the best free accounting software you need to take advantage of. It’s easier for you to visualize the monthly budget that you have when you’re able to make that calculation rather than just move along and pay bills whenever they arise.

    My wife and I do a monthly budget and we have been able to stick to it for years. Our secret? Fun Money. Fun money in your budget is like a cheat day on a diet.

    Fun money is built into our budget to give us the opportunity to spend money on junk we normally wouldn’t. It is a predetermined amount of money we delegate each month so we can do a little retail therapy if we need it. It’s like looking at a jelly donut and giving yourself permission to eat it – once a month.

    free budget printable

    When most people fall off the bandwagon, they fall hard. It usually involves a phrase like, “Well I already overspent this month, what’s one more night out?”

    Fun money gives us the ability to spend and “mess up” within boundaries.

    If you need help starting a budget, I wrote an extensive article on how to start a budget and also designed several free budget printables.

    A budget is a spending plan that gives you a path to follow. This spending plan will later transition into a debt repayment plan.

    • Cash Is The Secret Weapon To Control Your Spending

    Using cash is the absolute secret weapon. We manage our fun money with cash so we are not tempted to overspend. Credit cards are not used for everyday purchases, because cards make it too easy to overspend.

    • Spending Is Emotional

    Spending money is an emotional experience. If you don’t believe me, start using cash for your purchases. Your amount of spending is directly tied to emotion and can be painful or pleasurable.

    When you use a credit card, it’s a relatively painless experience. Even if you know you don’t have any money in your account, swiping that card doesn’t hurt very much. You are deferring your pain until you are forced to pay it in a couple of weeks.

    If you make your purchases with cash, it will hurt each time you make a purchase. If you’re holding $20 dollars in your hand and it needs to last until the end of the week, each time you buy something it will stress you out. Knowing that there is only a finite amount of money will help you control your spending.

    By taking out a certain amount of cash each month, we can regulate our spending much easier. If you know you only budget $500 a month for food, take out the $500 in cash at the beginning of the month, or $250 twice a month. When you go to the grocery store, leave your credit cards at home.

    Leaving the cards at home forces you to stay on budget and actually do some basic addition at the grocery store. In addition, using cash can break your spending habits and create better ones.

    3. Separate Your Needs From Your Wants To Get Out Of Debt

    From time to time, we need to go over our spending and make sure our wants have not sneaked into our budget as needs. Depending on how bad your debt situation is, you may need to eliminate most if not all of your wants for a while. Yes, you can still budget in a little fun money, but the cable TV may need to go.

    For a review, your basic needs in life are:

    • Food (not eating out at restaurants – but basic grocery store food)
    • Shelter (a basic house that keeps you out of the elements)
      • This does not include a 4,000 square foot home if you can not afford the mortgage payment.
    • Clothing
      • Again, not designer clothing.
    • Transportation
      • Transportation includes a basic mode of transportation to get you to and from work. This can be public transportation, a bicycle, or a used vehicle – not a car loan on a new BMW or a leased Audi.
    • Utilities
    We Waste So Much Money

    When you break down what our basic needs are, you can really see how much money we waste on a monthly basis. If you were to only pay for your basic needs, it’s very likely you would have plenty of money left over each month.

    In order to get back to the basics, you may need to downsize your house or get an apartment in a cheaper neighborhood. You may need to sell your car and start taking the bus to work.

    There are a bunch of things you could do to decrease your bills – it just depends on how bad you want to get rid of your money stress.

    Being frugal is not necessarily a bad thing.

    If you don’t want to downgrade your housing or sell your vehicle for a cheaper used one, that’s ok with me. You won’t hurt my feelings. However, the less you are willing to sacrifice, the longer it will take you to get out of debt. The more drastic you get, the quicker you will reach a life without debt.

    4. Check Your Credit Report To Find All Of Your Debt

    credit report

    Each year, you can run your free credit report at This is mandated by the Federal Government and Annual Credit Report is endorsed by the Federal Trade Commission. Collection agencies regularly report your debts and payments to the major credit agencies.

    Don’t fall for scams that make you pay for your credit report.

    When you receive your credit report, make sure there are no outstanding credit card accounts that you forgot about or were unaware of. You need to properly identify and locate all of your debt in order to start attacking it.

    More than likely your credit rating has taken a hit due to your money problems. Too many people worry about their credit score rather than how much debt they have accumulated. Ignore your score – the last thing you need right now is another line of credit.

    5. Build An Emergency Fund Before You Pay Off Debt

    If you have a budget and immediately start attacking your debt, you are setting yourself up for failure. Unexpected life issues happen at the most inconvenient times – which is why we should prepare for emergencies in advance.

    In order to avoid future debt, we need to ensure we have cash on hand to pay for anything unexpected. If you are paying down debt and your car breaks down, you don’t want to put more money back on a credit card. The idea is to avoid any more debt. To do this, we need a separate account with cash in it to protect us against life.

    A good emergency savings is $1,500 – $2,000 in cash. The reason you need this much in cash is to be reasonably prepared for emergencies. If your vehicle breaks down, it may easily cost over $1,000 to repair it. By giving yourself enough of a cushion to deal with most of the potential expensive issues, you can set yourself up for success.

    • Quickly Fund Your Emergency Savings To Get Out Of Debt

    If you are living paycheck to paycheck, this may seem like an impossible amount of cash to build up. However, there are many different ways to quickly build this fund.

    You could start a side hustle or pick up a part-time job in order to start funding this savings account.

    In addition to additional incomes, a great way to quickly fund this savings is to start selling things on the internet or host a yard sale.

    If you need more help setting up your emergency fund, I wrote an extensive article on emergency savings here.

    6. Use The Debt Avalanche Or Debt Snowball Method To Pay Off Debt

    Now that you have your budget and emergency fund in place, you can finally start paying down debt.

    There are differences of opinion for which method is the best way to pay off debt, but either way will work. Both methods focus on paying off one debt at a time. If you use a shotgun approach and try to pay all of your debts off at once, you may never be debt free.

    To take out your debt in the quickest manner, pay the minimum on your debts except for the one you want to pay off. Put all your extra money towards one debt at a time to pay it off as quickly as possible.

    During this process, do not put any more money on your credit cards!

    Stay with your debt payoff plan in order to free up some extra cash that you can use to achieve your financial goals.

    For more detailed information on the debt avalanche and the debt snowball method, check out my related article here to decide which is best for you.

    7. Negotiate With Credit Card Companies To Settle Your Debt

    If you owe a bunch of people a lot of money, chances are they know it. Many people default on their loans and credit card companies are desperate to get as much as they can out of you.

    If your outstanding debt has been sent to a collection agency, you may be able to settle with the collection agency for pennies on the dollar.

    In order to do this, you usually need a lump sum of money before a company will be willing to settle. For example, if you owe $10,000 on a credit card, you may be able to settle it for $5,000 or less. A friend of mine wrote a detailed post about how to negotiate with debt collectors, but here are his main points:

    • You Can Not Trust Debt Collectors
      • Expect them to say whatever they can – even lie – to get money from you.
    • Make Them An Offer To Settle The Account
      • Some creditors will settle the account for 50% in a lump sum, while others will only settle for 75%-60%. Be respectful and see what you can get them down to. Keep in mind, their job is to get as much money out of you as possible.
    • Never Pay The Debt Over The Phone
      • This is a common tactic used to get your payment information that they can later use to withdraw even more cash.
    • Any Settlement Amount Should Be Written Down
      • Don’t take their word for it that your debt is settled. Have them send you an invoice that shows the amount to pay for the account to be “settled” – before you mail them a check.

    8. Increase Your Income To Get Out Of Debt

    Increase income to get out of debt

    During this process, you may have made all the cuts you possibly can. If you find yourself sticking to your bare-bones budget and still have difficulty making progress, you may need to explore a different career path.

    You may just not make enough money.

    Start looking for other employment opportunities that you can transition into to increase your income.

    In reality, you may not have a spending problem, but you may have an income problem.

    Start working on a fantastic resume and don’t be afraid to put yourself out there. You obviously have a good amount of drive and motivation which means you have the ability to increase your income. Make sure you work hard at your current job until you are able to find another avenue of employment and income.

    For a quicker fix, you may need to pick up a second job or a side hustle.

    9. Save Money On Everyday Purchases

    If you are looking for extra ways to make money, I have put together an extensive guide on how to save money on everyday expenses. The Ultimate Guide To Save Money was written with you in mind to save money in places you didn’t think possible.

    Options You Should Avoid To Get Out Of Debt

    During your debt free journey, you will run into people who will offer you shortcuts and other quick ways to get out of debt. Please heed my warning when I tell you that there is no “quick fix” to lower debt “legally.”

    Balance Transfers

    Balance transfers offer a quick fix by kicking the can down the road. If you plan to transfer credit card debt to a new 0% interest rate card, pay attention to the transfer fee. Most cards will charge you to move your money over. Also, at the end of the 0% term, your balance will quickly turn into high interest debt if you were not able to pay off the credit card debt before the promotion expired.

    Debt Relief Plans or Debt Consolidation Loans

    I wrote an extensive article about debt consolidation over here, but in a nutshell, these are the main points:

    • Consolidation loans promise lower interest rates but this is not always the case
    • Balance transfer fees will be added to your total debt
    • Debt consolidation loans will increase the amount of time it takes to get out of debt
    • Your credit score can be hurt by applying for new loans
    • A lower interest rate does not mean you will be saving money in the long run

    Debt consolidation may be beneficial in certain circumstances, but overall they usually cost you more money than they are worth.

    Loan Forgiveness Plans

    We have all heard of the Federal Student Loan Forgiveness Plan. However, did you know that in 2018, a total of 19,321 students applied for forgiveness, yet only 55 of them met the strict criteria?

    There are so many hoops to jump through and so much fine print that the majority of people who were promised forgiveness were never eligible in the first place.

    A Home Equity Loan To Fix Your Debt Problem

    Sure it may feel like your debt is gone and it only increased your mortgage by $100 a month, but do you have any idea how much money you are going to pay in interest over the life of that new loan?

    Plus, have you really fixed the spending habits that got you into debt in the first place or are you going to go back to your old ways and back into debt?

    Transferring your debt to your home equity loan doesn’t necessarily give you a permanent fix. It only adds up to an even greater payable on another loan that’s still existing.

    A new loan is not the answer to an old loan.

    Filing For Bankruptcy

    Bankruptcy should be an absolute last resort, and even then, it does not solve all your problems. For those who qualify for bankruptcy, some of your debts remain with you such as your mortgage, student loan, taxes owed, alimony, and child support.

    So as much as possible, you’re going to want to avoid this. It’ll only get you by temporarily, but not necessarily free you of your payables.

    In addition, a judge is involved in your case and can make decisions on what you can spend your money on. It is incredibly restrictive and will destroy your credit score for 7-10 years, depending on which chapter you filed for.

    This can make it even harder for you to get back on the right path after trying to recover from debt.

    Closing Thoughts On How To Get Out Of Debt

    Easy steps to get out of debt

    I have no doubt that you are sick and tired of being broke and drowning in debt. I want you to know that you are not alone and there is hope. I have worked with many people in “hopeless” situations that were able to climb out of their debt holes. If they were able to achieve this, then there’s no reason that you can’t as well.

    It’s not about managing your debt; it’s about learning how to become debt free.

    To eliminate debt, becoming debt free must be in the front of your mind. By sticking to your chosen debt repayment plan, you will be able to get out of credit card debt and finally start to breathe again.

    Whenever you become tempted to use that card or start on unnecessary expenses again, always put in mind your goal to become debt free. This mindset can help put everything into perspective.

    As I stated before, you are key to get out of debt. I provided you a path to follow in order to take control of your finances, it’s up to you to start the journey. If you have any questions or need additional guidance, please do not hesitate to reach out to me at I am also on social media mentioned on this site.

    I look forward to hearing about your success on this journey. You can do this, you work too hard to be this broke!


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    General FAQ

    What does it mean to live paycheck to paycheck?

    Living paycheck to paycheck means there is no extra money in between paychecks. If you’re lucky, you are able to make the minimum payment on all your high-interest credit cards and your never-ending student loan debt. Paycheck to paycheck means you’re barely able to cover your expenses until your next check comes in.

    What is the secret to getting out of debt?

    You are the secret to getting out of debt. There are no hidden secrets or get rich quick schemes that actually work. Through hard work and proper planning, you can turn your financial life around.

    How do I get out of debt?

    Anyone can get out of debt by following these simple steps:
    1. Refuse To Use Your Credit Cards
    2. Create A Budget That Actually Works
    3. Separate Your Needs From Your Wants To Get Out Of Debt
    4. Check Your Credit Report To Find All Of Your Debt
    5. Build An Emergency Fund Before You Pay Off Debt
    6. Use The Debt Avalanche Or Debt Snowball Method To Pay Off Debt
    7. Negotiate With Credit Card Companies To Settle Your Debt
    8. Increase Your Income To Get Out Of Debt
    9. Save Money On Everyday Purchases

    What is the best way to control spending?

    Using cash is the best way to control spending. By using a budget and a cash envelope system, you can more easily hold yourself accountable when it comes to discretionary spending.