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Living paycheck to paycheck is a choice

Living Paycheck to Paycheck is a choice

For those who argue the cost of living is too high to put any money away for retirement, and that's why people are living paycheck to paycheck, then why is it that....

Those who make $30,000 a year are living paycheck to paycheck,

Those who make $40,000 a year are living paycheck to paycheck,

Those who make $50,000 a year are living paycheck to paycheck,

Those who make $60,000 a year are living paycheck to paycheck,

There are even those who make six figures who live paycheck to paycheck and for some reason they all seem to blame the “cost of living”.  Why doesn’t the person making $60,000 live like the person making $50,000 and put the other $10,000 away?  They could use that extra money start a business or perhaps purchase an investment property to better their situation, or just max out their 401k with company match and guarantee an early retirement as millionaires.

Humans have an almost innate tendency to spend every cent we make, then we blame everyone but ourselves for our inability to save.


$3 a day = $1 million

Investing even $3 a day from the age of 22, into a 401k with a company match earning a 9% return will net the contributor a total of just over $1,000,000 by the age of 65.  Perhaps people cannot save an extra $3 a day, fact is, majority of the population isn't even putting away $1 a day.  Roughly 42% of people close to retirement age have less then $10,000 they are not even putting $1 a day away.  It simply is not a priority (for the record, $1 a day in a company match 401k will still return $350,000 come retirement).


Smoking a pack a day is costing you $2.2 million

About 25% of smokers smoke a full pack a day.  The national average for a pack of cigarettes is $6.28 but can be over $12 in places like New York.  By investing that $6.28 into a 401k with a company match you would earn over $2,200,000 come retirement, not even factoring in the health benefits and savings associated.  The point being, there are things we spend money on that we simply do not need, removing these things could make us millionaires.  Make your future self-rich, you will thank yourself.


It is an unwillingness to sacrifice or to do more

The reality is most people are living paycheck to paycheck because they simply are not willing not to.  It could be that they are not willing to make a few sacrifices or they are not willing to work harder to earn more.  That does not mean they should go get a second job (I am actually very against getting a second part time job), it simply means they are too comfortable in their discomfort.

If all it takes is $3 a day to be a millionaire come retirement how hard is it really to save an extra $3 a day?  Drive a cheaper car, cancel cable and get a fire stick, do not eat out, quit smoking or drinking, pack lunches, rent a cheaper apartment, don’t worry what other people think.

Making an extra $3 a day is even easier than trying sacrifice and save an extra $3.  Get up early on Saturday morning and head to a garage sale, even if you have kids this can be a fun family activity.  Go with $20 or $10 or all the coins you can find in your couch and the floor of your car.  People at garage sales are looking to get rid of stuff for cheap.  Buy something for $1 and sell it on eBay for $15.  Purchase a larger item for $15 and sell it for $50 on Facebook marketplace.  Point is, making an extra $100 a month is so easy it is borderline infuriating that everyone is not out there doing it, especially those who complain that they can’t get ahead then don’t even try.

Check out our Self-Help page for more suggestions on how to make extra money or get out of debt faster.


Try automatically saving with Acorns

Have you ever heard the saying "Pay yourself first"?  Acorns lets you pay yourself without even realizing it.  When you purchase something with your debit card the total is rounded up to the next dollar and that "change" is invested for you.  So if you purchase something for $3.55 Acorns will automatically put $0.45 into your investment account for you.  It doesn't sound like much, but in a year you'd be amazed at how much it has grown, I know people who check their account and are shocked to see $1,000 and the best part is they didn't even notice the money being saved.



I get that it is not always easy, but things that are truly worth doing rarely are.  What bothers me most is the excuses.  Instead of blaming “the cost of living” the non-savers should try saying “it’s simply not a priority to me” and see how that rolls of their tongue.


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