20% of Working Americans Regularly Run Out of Money Between Paychecks

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Here’s what to do if you’re in the same boat.


key points

  • Many of today’s workers are financially stressed — and stretched thin between paychecks.
  • There are several steps workers can take to shore up their finances, like getting a side hustle.

Today’s economy is a tricky one. On the one hand, jobs are abundant. On the other hand, inflation is causing the cost of everyday living expenses to soar. And that’s putting a strain on a lot of people’s finances.

In fact, 20% of working Americans say they regularly run out of money between paychecks, according to Salary Finance’s fourth annual report. And that’s a dangerous cycle to land in, as it opens the door to debt, credit score damage, and other unfavorable consequences. If you’re in that boat, here are some steps to take to bust out of that rut.

1. Build an emergency fund

The feeling of having to wait until your next payday arrives to cover a bill is a terrible one. One way to prevent it is to build a solid emergency fund. That money can be used to cover surprise bills, but you can also tap your savings account during periods when living costs rise and your expenses are suddenly too high for your regular paycheck to cover.

Ideally, you should aim to have enough money in savings to cover three to six months of essential expenses. If you’re starting with nothing, know that it will probably take some time to reach that goal. But don’t give up. Instead, set small milestones. Aim to save $50 this month and $100 the next. And remember that having some amount of savings is better than having none at all.

2. Get on a budget

If money is tight, then it’s important to know where every dollar of yours is going. That’s why it’s crucial to follow a budget. If you don’t have one yet, go through your bank and credit card statements from the past six months to get a sense of what your different bills look like. Then, use a spreadsheet or budgeting app to track your spending.

Plus, once you have your budget in place, try finding spending categories to cut back in. You may not have any, or many, if you’re living frugally in an effort to stretch your paycheck. But if it’s possible to save $10 here and $15 there, do it.

3. Boost your income with a side hustle

Boosting your earnings could make it possible to build savings and cover your bills more comfortably. It pays to look at different side hustle options that allow you to do just that.

These days, the gig economy is loaded with opportunities to earn money on the side — even if you only have an hour or so a week. So think about the sort of side hustle that’s likely to work well for you. Maybe it’s a remote job you can do at home in the evenings once your kids go to bed. Or maybe you’re able to take on a gig like babysitting — one you can’t do remotely, but might pay very well.

Running out of money between paychecks means facing continuous stress — stress you don’t deserve. If you’ve landed in that trap, take these steps to improve your finances and land in a healthier place.

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