How I Broke Free Of Paycheck To Paycheck For Good
Back when I first started my business, I was proud of myself for breaking free of the corporate life. But one thing that I didn’t do right away that surprised me. It was that I did NOT break free of “paycheck to paycheck” right away.
To be honest, there were times when I wasn’t even living from paycheck to paycheck. It was more like “penny to penny.”
You see, I didn’t grow up with money. In fact, I grew up really broke. To the point where I only focused on what I could afford, never mind what I actually wanted. So that didn’t do much for my money mindset or money management skills.
Somewhere along the line between my corporate job and starting my business, I realized I had yet to break free of paycheck to paycheck. And it was not OK anymore.
Finally, I took the initiative to really change my financial life, and break free of paycheck to paycheck once and for all. I knew that things like money mindset and money mantras made a big difference in steering me in the right direction.
To be honest, there were a lot of steps I took to finally break free of paycheck to paycheck. A big part of the process was my money mindset, energy realignment, and money mantras. BUT, while in the process of mastering my money mindset and energy around money (always a work in progress for everyone), there were a few key ACTIONS I took.
I made these moves back in the day when I was only making around 35K a year. Despite my income level, my mindset work combined with these 3 key actions REALLY made some big shifts for me.
Here are the top 3 actions I took to break free of paycheck to paycheck…
Action #1: I got organized and make a super-simple money management plan
Because I had so little money to work with at the time, I knew I needed to spend wisely. I also knew it was time to get organized. So here’s what I did:
I printed a calendar, and put all my expenses on it. Then I evaluated my income. From there, I tracked my expenses by the day, the week against my income, and went from there. When I had any extra money leftover, I prepaid as many necessary expenses as I could (like utilities), in case I fell short the next month.
Action #2: I converted my high-interest credit cards into a fixed-rate loan.
Now, when I made this move, I knew that I could no longer use these credit cards, but that didn’t matter. I’d already maxed them out anyway. What did matter was that this meant I could actually make a dent in what I owed, rather than most of the minimum payment going to interest.
Action #3: I got serious about finding out where my money was really going. And took action.
Most financial advice out there tells you to “cut back on frivolous spending” to improve your financial situation. But at the time, I didn’t have any frivolous spending to cut! So what was I supposed to do in this situation when I’d already given up my daily latte?
So, I took a good hard look at where my money was really going. And I discovered that over 70% of my income was going to rent and utilities. That meant it was time to reevaluate my living expenses.
What did I do next? I swallowed my pride, gave up my apartment, and rented out a converted barn for just $500 a month. Now, it wasn’t the best of accommodations (it had a shower but no kitchen!). BUT, in doing this I had a plan.
I spent this time living within my means. I restructured my budget and worked on increasing my income. Over time, I was able to expand my budget to create the life that I really wanted.
In fact, it didn’t really take that long, because only 2 years later, I bought my first house!
Now, I don’t expect everyone to have the means or the desire to move into a barn for a few years to save money! But the barn really isn’t the point at all.
The point is that breaking free of paycheck to paycheck is about assessing where you are and knowing where you want to go. Then, shifting your spending and saving patterns and creating a budget to help you GET there.
Maybe you hate the idea of budgeting, and I totally get that. But budgeting doesn’t have to be a bummer. In fact, budgeting can be an inspiring activity to take the steps toward your financial future. That’s just the way I saw it, and I made it work for me!
This is what I love to teach entrepreneurs, and it has made such a difference in both my life and the lives of my clients!
So what do you think? Which of these 3 action steps resonates the most with you, and which one do you plan on putting into action first? I’d love to know…
Until next time…
Love, light, and MONEY, Honey…
Kaylee
P.S. Want to take control of your budget and use it as a way to not only grow your money, but also inspire you to new levels of financial success? My signature course the Chakra Budget & Balancing will help get you there! Learn more about how to change the way you see “budgeting” forever and align your energy with your money. I’ll show you how HERE!