Are you struggling to pay your bills?
Are you struggling to pay your bills?
Is your money tight at the end of every month?
Do your overall expenses exceed the income you are receiving?
If your answer is yes to these questions, then you are living paycheck to paycheck.
Have you ever found yourself things like, ”Wow, it’s the end of the month I don’t know where my money went.”
Living paycheck to paycheck is no fun. Living paycheck to paycheck is very frustrating.
You feel squeezed by your throat every month because you have no money to splurge on yourself.
You end up praying to God to help you NEVER have an emergency or if you have an emergency you DIY the emergency?
That’s what paycheck to paycheck living does.
You deserve a good quality of life without the pain of thinking about the end month.
You keep getting answers ”You have to be in charge of your finances to avoid living paycheck to paycheck. How can you be in charge of your finances when you earn $10/month?
The thing you need is first to understand where you are in terms of money.
What’s your money mindset, why are yous tuck in your job when you’re not happy, can you do something else to help increase your income?
Most Kenyans live in a financial rat race -you don’t have to add to the statistics.
Also, most Kenyans don’t know how their financial decisions and habits lead to paycheck to paycheck living.
If you suspect that your financial habits leave you with nothing to save or invest in before the end of the month, then this article is for you.
In this article, we look at the reasons why you are living paycheck to paycheck. And how to avoid living paycheck to paycheck.
Though I don’t encourage living life below your means because this isn’t the mindset I want you to have, I encourage you to become money-wise.
Develop a mindset where you believe and know money flows to you.
Because the money lying in our minds is more than 1000 shillings a month with a billion shillings in debt.
What Does It Mean to Live Paycheck to Paycheck?
To live paycheck to paycheck simply means that you use all your earnings on expenses.
Ask yourself this: How long could you survive or afford to pay your expenses if you lost your primary source of income today?
If you cannot survive for a period of time without your current job, then you are living paycheck to paycheck.
A person who’s living paycheck to paycheck is one who has to have their salary before they run out of cooking gas or before their landlord knocks on their door.
If this sounds like you, then keep reading to find out why you are living this way.
My Paycheck to Paycheck Story
How sad it is to live from pocket to pocket?
How sad it is to realise you have no money to pay your bills or cannot afford to buy a meal and swallow saliva as you pass by that roasting chicken?
How sad it is to salivate for a 10 shillings banana because if I spend that 10 shillings what will I use to buy potatoes with?
That was my reality 13 years ago.
I literally lived off of people borrowing until I formed enemies for myself everywhere.
No one wanted me and I hated everyone.
I blamed the job market in Kenya for turning me into a beggar.
Years later I ask myself, is it about the job market or is it that I didn’t know what my offer was?
It wasn’t about the job – jobs are out there and they’re scarce even today.
Not realising your offer or the solution you bring can make you jobless for years.
Want me to discuss jobs, getting hired online and offline and how offline or online jobs don’t differ?
Answer with your comments.
I got afraid of additional bills. Before making a dime, I started working on my mindset by reading the Bible a lot.
I didn’t understand anything because nothing talks about money in the Bible.
Along the way, I gave up and told myself, ”If I have faith in God He will make a way for me to have money and I won’t paycheck to paycheck.
It’s a sad life when you cannot afford it. You become depressed and nothing seems joyous.
In Kenya, we don’t earn money to sustain ourselves.
You have to look for a side hustle or quit your job or get a higher education to help you secure a better paying job.
No one has the luxury of quitting their job or getting an education when they cannot afford to pay their bills.
I understood and understand one thing from my paycheck to paycheck living, you’re not a victim.
If you become a victim of jobless, excises you cannot move up.
You can decide to get an additional job, start a side hustle, save to invest to escape the paycheck to paycheck living.
Whatever solution you come up with, let it be a solution helping you add money to your bank account.
The first step to an abundant life is your mindset.
15 Reasons You Live Paycheck to Paycheck
The following are reasons why you are living paycheck to paycheck.
- You have zero financial plans
A financial plan is a statement that evaluates your current financial situation and long term monetary goals as well as the methods you are going to use to achieve these goals.
One reason you are living paycheck to paycheck is that you do not have a financial plan.
There is no formula to anything.
I’ll tell you one thing: you cannot afford to be spontaneous with your income.
You need to have a plan on how you are going to use your current income in relation to your long term financial goals.
You also have to look for strategies that will help you live up to your financial goals and avoid living paycheck to paycheck.
- You do not have money goals
This is another reason why you are living paycheck to paycheck.
If you do not have any goals with your money, you will be exhausting all your income before the next month’s salary because you do not have something tangible you can put your money into.
You have to establish your money goals if you want to have a clear financial path and the motivation to avoid living paycheck to paycheck.
What goals do you want to achieve with your money?
Do you want to save?
Do you want to buy a bigger house or a new car?
Do you want to invest your money or pay off some debt you owe?
When you have money goals, you will not be living paycheck to paycheck.
- You do not track your financial progress
One of the reasons why you are living paycheck to paycheck is that you do not know where you stand in your finances.
Has your financial progress gone down or risen up?
If you do not know the answer to this, then chances are, you are living paycheck to paycheck.
You cannot evaluate your current financial position because you do not have much to work with.
You need to start tracking your financial progress every time you receive an income raise so that you can avoid living paycheck to paycheck.
- You are not tracking your spending
This is also another reason why you are living paycheck to paycheck.
If you cannot give an account of where your money has gone to at the end of the month, like putting your finger on something tangible that you have done with your money, then you are living paycheck to paycheck.
You are also not alone.
A lot of people are participants in this.
You can break this habit by starting to track your expenses and know how much money you are spending in a week or month.
You will be shocked by the results, but it is going to be worth it because you will know if you are living paycheck to paycheck and you will take the necessary steps to avoid this cycle.
- You focus too much on paying your bills
If you focus too much on paying your bill, then you are living paycheck to paycheck.
Don’t get me wrong. Your bills have to be paid.
But if that’s all you think about, the reason could be you are living paycheck to paycheck.
You may be having too many expenses or debts that you want to cover as soon as possible so that you do not have to incur any additional interest rates or fees.
Instead of focusing too much on paying your bills, why don’t you take time to develop your skills and acquire new financial habits that will take you out of this paycheck to paycheck cycle?
- You are keeping up with the Joneses
I’m told that your spending is influenced by 3Fs (FOMO, Friends, Family). Is your FOMO (Fear of Missing Out) mentality making you live paycheck to paycheck?
Are your family and friends always asking you to go out on expensive dates you cannot afford?
If your answer is yes to these questions, you need to reevaluate yourself.
Keeping up with the Joneses is another pandemic that has gripped the hearts of many youths in Nairobi.
You cannot save or invest because you have been caught up in the lifestyle creep.
You have to rely on your next paycheck to give you the temporary high of extravagant life, to your own detriment.
If you want to avoid living paycheck to paycheck, you have to learn self-restraint.
- You are living above your means
Living above your means to spend above your limits. It doesn’t matter if you are rich or poor. Money is finite. Even the world’s richest man cannot afford to go past his spending limit.
If he does this, then he will be living on his next paycheck.
There is only up to a certain amount of money you can spend.
If you are making Ksh. 80,000 per year, but your expenses go up to Ksh. 100,000 a year, then you are living above your means and you will be living paycheck to paycheck.
It’s that simple.
You have to adopt good habits and a lifestyle that is going to help be financially successful and get you out of this paycheck to paycheck cycle.
- You rely too much on your credit card
If you use your credit card too much and you are not able to cause a dent in your credit card balance, you will be living on your next paycheck, trying to pay this credit balance off.
Do not use your credit cards to fund your lifestyle or use it for everyday expenses.
Your credit card balance will keep on growing and if you cannot pay it off in full, you will be left with high-interest debt and a low credit score to feel humiliated about.
When you use your credit card, make sure you prioritise what you are spending on.
If you do not make a plan on how you will use your credit cards, you will abuse them and then end up living paycheck to paycheck.
- You have high interest debt
This is one of the most common reasons you are living paycheck to paycheck.
When you take out a loan or choose a credit card, you have to consider what you are going to be paying in terms of interest rate.
You do not want to take out a loan that has a very high-interest rate when you can get a loan with lower interest fees from another money lending institution.
Having to pay a high-interest rate is one of the reasons many people live paycheck to paycheck.
You want to make sure you do your research before you settle for any type of loan or credit card.
- You are paying the minimum on your debts
This is another common reason why you are living paycheck to paycheck.
If you only make the minimum payments on your credit card, you will be left with a huge balance and once that low introductory interest you have been given expires, it will become worse for you.
When you keep a running balance, interest rates are added very quickly.
The higher the percentage of the credit you are using, the worse you will look.
Making minimum payments will cost you money in the long run and it is going to be difficult to get yourself out of this debt.
Thus, you will end up living paycheck to paycheck.
- You live in an expensive house or you have a car you cannot afford
So you moved into a house that you took a huge mortgage loan on and you cannot afford to pay for it.
Or the car that you drive is too expensive for you.
It is clear that you have a lifestyle that you cannot keep up with.
This is a good reason why you are living paycheck to paycheck.
You need to find out how you can rent out your car or house to support yourself so that you will not live in financial ruin and failure.
- You fail to plan for irregular expenses.
If you want to know why you are living paycheck to paycheck, then calculate the amount of money you spend on irregular expenses.
You will be shocked by the results.
Your irregular expenses are a contributing factor to why you are living paycheck to paycheck.
If you will be dining out, getting new clothes or shoes and buying gifts for a birthday or a graduation party, then you need to plan for these expenses ahead of time.
This will make it easier for you to avoid living paycheck to paycheck.
- You worry too much about money
Are you stressing too much about money? Then stop.
This is a clear reason why you love paycheck to paycheck.
People who worry too much about money do this because they are always concerned that they are not going to have enough.
They will spend the rest of their days calculating bills and trying to hold on to as much money as they can.
You have to know that money comes and goes.
The more you hold on to it, the more you will not be able to use it on things that really matter. You have to avoid this habit if you don’t want to live paycheck to paycheck.
- You have no budget
Budgeting allows you to create a spending plan for your income.
When you budget, you will create a list of all the important bills you need to pay for and you will also avoid working outside the budget on things that you do not need.
A lot of people have said that budgeting has really helped them to escape the paycheck to paycheck lifestyle.
They understood themselves and they eliminated unnecessary expenses and debts.
If you are not budgeting your money, then you will inevitably be living from paycheck to paycheck.
- You impulse buy
When you go out and buy very big-ticket items without planning for them in advance, then you are probably living paycheck to paycheck. Things like cars and houses are not things that you buy on a whim.
You have to plan and save for it before you go out and buy them.
Buying large expensive items based on emotions will lead you to live a paycheck to paycheck lifestyle.
You will end up being strapped in debt that is going to be difficult to get out of.
Avoid impulse purchases and try to make a list every time you go out shopping.
- You do not save or invest
A lot of people love the idea of saving and investing their money, but very few people actually do it.
If you are not saving or investing at least 10% of your income every single month, then chances are that you are living paycheck to paycheck.
You could either be paying off expensive bills or you have poor financial habits that cannot allow you to put some money aside to secure your financial future.
If you are not saving or investing your money, you are really treading dangerous waters.
If you want to learn how to save, start reading financial books or work with professionals to give you a good head start.
Always remember, if you do not save or invest, you will, with no doubt always live from paycheck to paycheck.
17. Your money mindset sucks
You don’t know anything about scarcity and abundance.
Trying to not spend is a scarcity mentality.
I suffered scarcity mentality a lot.
You end up holding onto money, which makes you anxious.
In the end, you don’t make money.
Your mindset makes you a friend or an enemy of money.
You will have to change your view on money, what money means to you before you see a difference in your paycheck to paycheck living.
Dangers of Living Paycheck to Paycheck
These are the problems and challenges you will face when you live paycheck to paycheck.
- Stress and depression. A person who lives paycheck to paycheck will always feel depressed and stressed about money. If they cannot get money to pay their bills or cater for their expenses before the next paycheck, they go into depression.
- Your job is not a stable thing. You have to be very careful. Always consider the likelihood of your job coming to an end any time and find out what you will do with your life if you are living paycheck to paycheck.
- Your future is unsecure. If you are living paycheck to paycheck then your financial future is at risk and you need to change this soon. You do not want to live a life full of debts because you are living paycheck to paycheck now.
- Financial disaster. If you are living paycheck to paycheck, then you are likely heading to a financial disaster. It is going to be difficult for you to get yourself out of this situation if you are living paycheck to paycheck.
How to Stop Living Paycheck to Paycheck
The following are ways to stop living paycheck to paycheck and they include:
Where are you financially?
Stop spending on things you don’t need
(Buy Now, Pay Later, discount cards, credit cards) which encourage impulse buying.
Build an emergency fund
Make more money
Ask yourself how would you live your life if you don’t live paycheck to paycheck
Keep reminding yourself that you deserve a good quality of life
Automate your savings
Who are in your inner circle?
Those shaming you because you’re not buying things they ask of you.
Are you tired of all talk?
Are you wondering where your money went to?
Are you tired of not making progress?
Are you angry about debts?
What are Some Depressing Financial Issues?
Some depressing financial issues include:
Monthly subscription payments you don’t need
Living on borrowed money
Buying a new car when you can get a useful used car
Living paycheck to paycheck
Not investing in retirement
Not saying NO
FAQs Reasons You’re Living Paycheck to Paycheck
- Why do we live paycheck to paycheck?
Cost of living isn’t equal to salaries
2. What’s paycheck to paycheck?
Paycheck to paycheck is money coming in at month end the before you know it, you spend it all.
3. What are the dangers of living paycheck to paycheck?
The dangers of living paycheck to paycheck are:
No money for hospital
No emergency funds
4. How do you live below your means?
You live below your means by saving your money.
5. Is living below your means worth it?
NO, it isn’t worth it to live below your means.
No wonder I’m not a financial advisor I don’t believe in living life below your means but adding more to your income.
6. Can living paycheck to paycheck cause depression?
YES, living paycheck to paycheck causes depression.
There’s nothing as depressing as not having money for emergencies or fun or paying for your expenses later on in the month.
7. What’s financial stress?
Financial stress is a state of worry, anxiety or emotional tension related to money debt, upcoming or current expenses.
Resources Related to Why You Live Paycheck to Paycheck
What’s a Money Mindset and How Do You Get One?
Why Is It Important to Develop a Money Mindset?
Personal Finance Disclaimer
I am not a financial advisor but a passionate researcher, writer, entrepreneur and investor. I am on a mission to become financial sound – free of debt.
After years of freelance writing then ghostwriting on various topics, I landed upon Personal Finance. It was new and exciting but confusing.
I didn’t understand why I had to learn about money. Then I started learning about the mindset then taught mindset. Suddenly a topic jumped, money mindset and I thought what is that? I wanted to learn more.
I was stuck in my earnings and knew it was time to change my money mindset, the more I researched and wrote, the more I became interested in Personal Finance and everything money.
I love money, the smell, the feel, the colour – everything.
I want you to love money and develop a positive money mindset as I have.
In your journey to achieving financial freedom, you will discover things about yourself you thought weren’t in you. For example, I realised how materialistic I am and that ignited the passion in me.
Instead of closing myself up and talking about things like ‘LIVE BELOW YOUR MEANS’, we talk about how to add money, make money work for us and attract wealth using the Bible or what God wants from us.
Any words of wisdom you take from these money talks are my thoughts, mostly, personal finance books I read and what I do in my life.
I’m not a by the book kind of person and love to do trial and error.
So, after reading go ahead and ask for financial advice. I know Kenyans don’t love hearing words like ”Financial Advisor”.
Take my words with a grain of salt.
This works for me; read then find what works for you.
For example, I believe in the Law of Attraction and God when it comes to wealth. You may not. I want to share personal finance wisdom according to me.
So ask further by reading and researching further.
I hope you enjoy reading these personal finance topics as I enjoy writing them.
Love and Success.
Remember to always ask me your questions below or shoot an email to gertrude dot akinyi at gmail dot com
The truth of the matter is that no one who looks at the end result of their financial life wants to live paycheck to paycheck.
Living paycheck to paycheck is stressful. You swallow saliva for things like a piece of banana.
Paycheck to paycheck is a constant 360° turn every month with your salary after you get paid.
People who live paycheck to paycheck don’t get to enjoy the fruits of their labour.
They are always caught up in paying endless bills and taking out loans to pay loans.
Now, does this sound like you?
Don’t worry. You are not alone.
There is a fast-growing subculture of people who want to plan, save and invest their money in the right way without being stuck with bills.
You can join this bandwagon, gain financial literacy and attain financial freedom.
You cannot afford to live paycheck to paycheck for the rest of your life.
God wants you to have more.
God yearns to bless you with more so don’t feel stuck and ask Him what you MUST do to stop living paycheck to paycheck.
It is time for you to swallow the red pill and identify the reasons you are still living paycheck to paycheck.
You will start seeing good progress by asking questions like why do you live paycheck to paycheck and what can you do about it?
Are you living paycheck to paychek and are wondering how to get 1M+ by June 2022?
Why are you living paycheck to paycheck?
What’s your money mindset like?