Are you living paycheck to paycheck & no savings? How are you supposed to save money while living paycheck to paycheck? How to save money ideas so you can break the cycle.

woman in tropical location, staring outside with text overlay "how to save money while living paycheck to paycheck"Living paycheck to paycheck no savings…does this describe you? Or do you wonder, “am I living paycheck to paycheck?”

Either way, I've got ways to squeeze lots of extra savings out of your current paycheck.

Pssst: Don't have an emergency savings fund? Start by funneling the money you find below into one of those. Then work on saving for something you want. 

I Live Paycheck to Paycheck How Can I Save Money

It will take some commitment, planning, and perhaps some psychological warfare, but I've got some ideas for how you can get started saving money.

First Off, Make Your Savings Account a Black Hole

One of my stop living paycheck to paycheck tips?

Something that I like to do is automatically withdrawal a budgeted amount from my checking account into my savings account before I pay any bills.

I almost make it into a game—once that money hits my savings account, I would rather cut off my right pinky finger before transferring it back to my checking to cover bills.

The money becomes dead to me.

This makes me creative sometimes in finding solutions, or tests my patience as I wait to have things replaced until next month in order to keep that money in my savings account. You may surprise yourself at ingenious ways you come up with to not touch that money.

And then…it happens!

The next month has all ready arrived, and that money is now safe and sound, earning interest.

Deposit Your Two Extra Paychecks

Most people on salary are paid on a bi-weekly basis, receiving a total of 26 paychecks, and some are on a weekly basis, receiving a total of 52 paychecks.

That means that for two months out of the year, when there are five weeks in that month, you receive three paychecks instead of two (or five paychecks instead of 4 if you are paid weekly)!

Since your budget and bills are set up for two paychecks per month, take advantage of this ‘extra’ money by depositing it directly into your savings account.

Without much effort, that equals an entire months’ pay that you will save over the next year.

Note: if you are paid monthly like I am, or you are paid two times per month (like the 2nd and 4th Friday), then this scenario will not occur for you.

Contribute the Max or Desired Amount to Your Roth/Traditional IRA in 10 Months Instead of 12

The current limit for Roth/Traditional IRA contributions is $5,500 per year (for 50+ you can contribute $6,500).

Divide this out by ten months, or $550-$650 per month (depending upon your age).

Automatically deposit this amount each month, and then turn off your contributions for November and December, as you are unable to contribute more. Instead, turn on your savings account contributions, and reap an extra $1100-130 to put in there.

Even if you are not maxing out a Roth or Traditional IRA, figure out what you would like to contribute, and divide by 10 months instead of 12, and have that amount automatically deposited into your IRA account. For the last two months of the year, deposit it into your savings.

Lower Your Fixed Expenses

If you own a home, you can shop around for lower home insurance, as well as fight property taxes to see if you can get your tax load lowered.

If you get these lowered and pay into an escrow, have the company where you keep your escrow account reassess and lower your monthly payments—cash you can now put into a savings account.

If you own a car, shop around for lower car insurance. Pit competitive internet and cable companies against one another with sales ads and sign onto a contract for a lower rate with a new or existing company.

If you rent an apartment, refer others to the apartment complex and ask for a break on your rent in return. Bank all of your savings as if you were still paying the bill.

Give Your Recurring Bills a Summer Break

For summer vacation this year when your kids are home and most hot t.v. shows are on hiatus, get rid of your cable and internet (make sure you will not incur fees for doing this).

Instead, trek to the library (best way to save on netflix) to enjoy magazines, books, internet use, and free DVDs.

Also check out Hulu and purchase a $2-$10 HDMI cord to run from your laptop or computer to your television to see some of your favorite shows for free.

During times of good weather, drop your gym membership (if you had one — which you might want to reconsider, since you're living paycheck to paycheck) and run/walk/hop outside instead.

You can always sign back onto these services, and in the meantime, you can bank some extra cash (24-hour fitness has a month-to-month contract, do other gyms).

Skip Grocery Shopping

If you normally shop each week, skip one week and live off of what is in your cupboards, fridge and freezer all ready.

If you shop every other week, try to shop just once for the month!

Most of us have stockpiles of food, and we need to cash in on them every now and then to reap the benefits.

If you stock up for hurricane season, eat through some of your hurricane supplies at the end of that season (okay…I know Chef Boyardee does not seem that appealing, and is not all that healthy, but tuna fish and such will work! You can donate the rest).

Bank the extra $100 or $200 from not shopping. Repeat this every six months.

Deposit Any Tax Returns

Have a tax return coming to you from 2010? Instead of earmarking it for stuff, direct deposit it into your savings account, not your checking.

If you are disciplined enough in saving money, work with your HR department to have less money withheld for taxes, leaving you more money each month to put into the bank.

If you own a home or have substantial medical bills and you can take an itemized deduction this year instead of the standard, make sure to clean out your closets and make donations.

You can use the online free service ItsDeductible in order to keep track of the value of what you donate, and then you can get a bigger tax refund.

Displace Some of your Vacation Costs

Is an annual vacation part included in your paycheck-to-paycheck budget?

Displace some of your expenses at home while you are away by calling your car insurance company and making your auto policy temporary for the two weeks or week you will be gone.

This will save you some money.

Also, turn your water heater to “vacation” mode, or off while you are gone. Turn your thermostat up or down depending on what time of year you leave, shut your blinds and curtains to help temperature fluctuations and for security purposes, and find a neighbor or friend who can cat or dog sit for you instead of paying a kennel. You can return the favor on their next vacation.

Stop Living Paycheck to Paycheck Tips

I just love that you're wanting tips for how to stop living paycheck to paycheck no savings.

The above steps will definitely help with this; but I'm going to give you a few other ideas.

Final Tip #1: See if You Qualify for Any Savings Match Programs

The thing is, you've got to set money aside. But you might be wondering how on earth you can do so, when you're living paycheck to paycheck.

There are Savings Match Programs out there sponsored by banking institutions, the government matched savings account, nonprofits, your employer, etc. that you need to apply for to make the most out of any money you can set aside.

19 replies
  1. Budgeting in the Fun Stuff
    Budgeting in the Fun Stuff says:

    In my experience, for anybody wanting to cut costs fast, look at these areas:

    1. Housing – Can you rent somewhere cheaper or profitably downgrade your house?

    2. Food – We easily cut $200 a month from our food budget simply by eating at home 5 nights a week instead of 2 nights a week.

    3. Cars – Can you cut car costs significantly in some way – cheaper car, less “fun” driving, higher insurance deductibles, etc.?

    Those three things usually account for more than 50% of a person’s budget…if I was living paycheck to paycheck, that’s where I’d look first.

  2. Bryce
    Bryce says:

    Good post. I am always finding ways to squirrel money into savings and our investment accounts. A big one for cash flow was once we paid off our mortgage, we’ve just kept our monthly payments going into our investment account.

          • Bryce
            Bryce says:

            We live in Silicon Valley. Paid $350k for small 1370 sq-ft home in 1998 with 40% down, then shoveled equivalent of all of my wife’s engineering salary at the mortgage, 529, max in retirement funds, and whatever was left into taxable investments. When mortgage got down to where we couldn’t deduct the interest any more, around $50k, we paid it off in one lump sum just before the 2008 recession.

  3. Syed
    Syed says:

    Great idea to deposit the two extra paychecks. August is actually one of those months for me I will go ahead and deposit that extra check into my savings. First time on the site by the way loving it so far!

  4. Joe Raymond
    Joe Raymond says:

    I don’t have a Roth IRA but I do have a 401k. I would suggest contributions at least up to the amount that your employer matches. That’s money you don’t even have to work for!


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