Monday, July 23, 2007

Leaving Paycheck-to-Paycheck Behind

For those of you working your way out of debt: Earlier this month J.D. at Get Rich Slowly wrote another of what I'd call a "Can't Miss" post:

Get Rich Slowly: How I Escaped from Living Paycheck-to-Paycheck

It's a topic that hits a touchy place in my heart, because I too went through it in my younger years. I'd like to think that I'm leaving Paycheck-to-Paycheck Land farther behind each day. Not that the trip wasn't interesting, but I'd just as soon call it a Been There, Done That ... and move on.

In any case, J.D.'s list of items for overcoming the P2P (money, not computers) Syndrome is precisely on-target. I'm going to expand on a few items, though, because I think some emphasis wouldn't be a bad thing.

  • You have to really, truly want it. You're either willing to do whatever it takes, or you're not. Most people are not. Deliver pizzas in the evenings. Deliver papers in the mornings. Clean houses on the weekends.

    And oh yeah — if you're doing it, stop buying stuff you don't need with money you don't have.

  • Stop blaming others. Stop blaming "the system." Accept responsibility. Here's the line that always seems to pop up: "I don't really spend money on anything, but my spouse ..." Dumping off the blame onto someone else is an easy out, but it doesn't help your situation one bit. And no matter what you may think, a large amount of the problem still resides with the person in your mirror. Somehow, you have to change that person first. After that, if marital issues are present, then it may be that counseling of some sort is required.

  • Be willing to reevaluate EVERYTHING. When it comes to where your money's going, take nothing as a given. Reconsider everything. If you're not already tracking your spending, start doing it. Start yesterday.

  • You must be able to make good decisions ... and then execute them. This one should go without saying, but I'll say it anyway. To be honest, I believe most people can tell the difference between good decisions and poor ones; they simply couch their poor decisions in excuses like "I deserved it" or "I didn't really have any choice." (Note please my previous post regarding people who suck with money. Here's where those phrases typically kick in.)

  • It never hurts to learn more, or hear different perspectives.
  • There's a reason I devote space at IYM to book reviews, a personal finance reading list, a financial blogroll, and started Debtspiration. I believe that reading about money, and learning how others have both failed and triumphed with it, is integral to conquering money problems. You simply never know when an author's words are going to resonate with you, and resonate deeply. When it happens, it is like gold. When rough times come along — and they will; it's a guarantee — those words may be the one thing that keeps you going.

I could've saved myself a LOT of stress, and a lot of money, if I'd taken these ideas (as well as J.D.'s) to heart years earlier than I did.

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— Posted by Michael @ 9:57 AM


Hey Michael, thanks for this wonderful post! I agree with you, especially the point about stop blaming others but take full responsibility. It's amazing how things start to improve after that. I can personally vouch for this, as I used to live a paycheck-to-paycheck lifestyle. I longer feel 'high and dry', but sober and focused :)

Anonymous Anonymous
, at 8:35 AM, July 24, 2007  

Hello Michael,

Good post, I want to share this with one of my friends who lives on her pay check to pay check. I am going to share this with her in hope that she will follow you and leave the situation behind like you did. Thank you for sharing.

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Thoughts on my personal finances, goals, experiences, motivations, and accomplishments (or lack thereof).

My financial life began turning around when I took responsibility for it.
— Dave Ramsey


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