Say Goodbye to the Paycheck Lifestyle

Having to live from one paycheck to paycheck to another is very stressful, and it doesn't take much to turn such lifestyle into a total financial disaster. What if you get sick? Or your car breaks down? What if your company lays you off or if you need to take an extended sick time off work?

These are the types of situations that strike fear in your heart, and it's time to take charge of your financial situation. It isn't easy, definitely. However, the peace of mind and the freedom you will experience are worth the sacrifice and effort. To get rid of the paycheck-to-paycheck lifestyle, take note of these three steps to reclaim your financial freedom:

Examine your expenses

When it comes to personal finances, people try to implement changes without considering what needs to be changed. You maythat think you're overspending groceries, for example, but maybe what you're really spending too much on is entertainment. Or, you may be thinking that by paying off your credit cards, you'll be able to free up more cash - but your car is too expensive to maintain for the lifestyle you are leading. Hence, before you make any financial goals, take the time to do a deep and thorough audit of your personal finances. What are your highest bills on a monthly basis? Where are you spending the money you don't even realize you're already spending? You'll be surprised at what don't know about your spending habits. By arming yourself with knowledge,it is a great way to get started.

 Set SMART goals

You really won't get anywhere financially if you just go along aimlessly, if you are only ensuring that there's food on the table and that you pay your bills on time.  But progress may be guaranteed if you simply set goals. These goals will ensure you are focused on your efforts. You can start by setting simple goals that are easily obtainable. Remember, it needs to be smart: specific - so you know exactly what you are getting at, measurable - so you can measure progress and milestones, achievable -so you don't give up easily, realistic - so you can indeed accomplish them, and time-bound - so you have a deadline to work by, making you more focused and determined. When you achieve a small goal, set a slightly bigger one and work from there.

Keep your budget realistic

Now that you are aware of your spending habits and have set your goals to address them, then it's time to budget.However, many people end up planning their budget based on the ideal scenario, thinking that they can do the change overnight. This is a common mistake that can backfire - as the shock could cause you to spend more to make up for what you didn't buy. Start by deducting a small amount from your original budget, and then work from there.