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3 ways to avoid living paycheck to paycheck

There’s a good chance you live paycheck to paycheck if you earn less than $100,000 per year; In fact, a CareerBuilder survey reported 78% of Americans under the $100,000 threshold report having to stretch their paychecks. On top of that, 24% of Americans told BankRate they have no money in an emergency fund in case of an unexpected expense.

These three steps can help you break the cycle.

Watch your money

Set up a monthly budget, and stick to it. Categorize your spending; you can even create a “fun fund,” or whatever name you want to give it, for drinks and nights out with friends.

Make saving automatic

Set up an automated transfer every month, or even every week, from your checking to your savings. Or, you can even set up a second account with your job and have the money automatically deposited there.

If you save $25 a week, that’s $1200 a year! Just make sure it’s not easy to transfer that money back to your checking account; you’ll want to save yourself the temptation.

Cut the fat

How often do you actually go to the gym? What about your Netflix or Hulu subscriptions? Those seem like little charges, but they can add up pretty quickly. Focus on your needs — the roof over your head and the food in your fridge — over your wants.

Remember, just because so many people live paycheck to paycheck doesn’t mean it’s normal. Check your cash flow to make sure you have more coming in than you’re spending.