We’ve all been there—the end of the month. It comes around twelve times a year and doesn’t really care if you’ve got enough money to get you through. Seventy-eight percent of Americans know exactly what we’re talking about because they’re living paycheck to paycheck . . . to paycheck.1
It’s easy to get into the habit of just doing the same thing over and over, but before you realize you’ve been here before, you’re already out of money and it’s not even the end of the month—again.
So, what gives? You’re just not making enough money, right? Well—that’s one way to look at it.
What to Do If You’re Running Out of Money
Here’s the truth: It will never matter how big your paycheck is if you’re always spending it on your past (like those credit card bills) or on the little things that always add up into big things. Sound familiar at all?
It should. So, if you’re looking for solutions to your money problems, you have to stop doing the same things you’ve always done.
Are you ready? Stop the cycle of running out of money by following these four steps:
Step 1: Prioritize Your Spending
Your income is your biggest wealth-building tool, so it’s time to start putting it to use. It’s time to get serious and take real inventory of where your money is actually going.
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Go ahead, log in to your bank account, pull up that activity, and look at your expenses, both big and small. Where are you consistently spending money and what are you spending it on—other than bills? Do you see a pattern? (Ahem, those weekly coffee runs add up.)
No matter what you find, it’s important to dig deeper and ask yourself, Is this purchase a need or a want? If it’s a need like your utility bill or student loan payment, that’s a different story. But if it’s a want like that wine club subscription or random app store purchases, you might need to give your spending habits an overhaul.
How do you do that? By creating a zero-based budget—income minus expenses equals zero. This type of budget puts you back in the control seat as you tell every single dollar where to go. This is one of the few instances where seeing that zero is actually a good thing.
Great news: We’ve created a free budgeting tool called EveryDollar to help you do just that.
Step 2: Pay Your Important Bills
This goes without saying. So let’s go ahead and tackle your next question:
Which Bills Do I Pay First?
When you’re running out of money and you’ve got more bills than you know what to do with, you have to play favorites. So get out your no-nonsense sunglasses for when you’re reading those sternly worded letters from the credit card company. Guess what, debt collectors: You’re not getting paid . . . yet.
Keep shuffling through your bills until you find the ones that cover the Four Walls. These are your basic necessities. You want to pay these first and in this order:
After you’ve got your Four Walls covered, you can start sending what’s left to cover your other payments, like your credit card or student loans.
What Should I Do When I Can’t Pay My Bills?
This is rough. We can feel the anxiety rising in your chest. But before we jump in, take a deep breath. If you can’t pay your bills, because of the pandemic or another income-related issue—it’s going to be okay.
After taking care of your family, if you don’t have any more money to send to Mastercard or Sallie Mae, it’s not the end of the world. And even if your bills go to collections, you still have time.
Remember: No matter what that creditor might say, don’t let them bully you into believing that paying their bill is more important than putting food on the table.
It’s time to get creative. You’ve already done inventory on where your money is going (hopefully) and made a zero-based budget. Now it’s time to cut spending and bring in more money.
Step 3: Find Ways to Cut Spending
Remember the patterns you found in your monthly bank statements? Whether it was coffee, extras at the grocery store or those little Amazon purchases, it’s time to cut them out—or find a good substitute.
1. Brew your own coffee.
Instead of hitting up the coffee drive-thru line, purchase a bag of beans from a local coffee shop. Not only will you be helping a small business, but you’ll be making your dollar stretch even further (without sacrificing quality).
2. No one is too good to use coupons.
There’s no shame in cutting coupons and shopping the sale aisles. In fact, you can make it a game. It’s fun, and there’s a sense of pride that comes from saving money for your family. And since paper coupons are harder to come by these days, try out a few money-saving apps like Ibotta, Honey or RetailMeNot.
3. Review your subscriptions.
We all do it. We sign up for that gym membership thinking we’re going to turn over a new leaf and work out every day. But the last time we logged in was two months ago. If that’s you, there’s no judgment from us, but it’s time to say goodbye—at least for now. Those $14.99 per month subscriptions don’t seem like much at first, but they add up fast.
When it comes to cutting extra spending, you’ll need discipline. And that’s not something you’re born with. Get a trusted accountability partner (or your spouse) and ask them to review your spending habits for a season. Not only will it make you think twice before you swipe your card, but it’ll also give someone the opportunity to provide other ideas you may not have thought about.
Step 4: Find Ways to Make Extra Money
Since marching into your boss’s office and demanding more money isn’t the best idea, you’ve got to think outside of the box. When you’ve got more bills than income, any extra dollar counts. Here are a few ideas to help you bring in extra cash:
1. Deliver food.
With social distancing and stay-at-home measures in place, the food delivery game has taken off. If you’ve got a valid driver’s license, a working car (or bike) and some time to make deliveries, this might be the perfect opportunity for you. Check out food delivery apps like UberEats, GrubHub, Postmates or DoorDash. Companies like these offer a base pay, and you get to keep your tips!
2. Shop for groceries.
3. Become a glorified mailman.
Everyone loves a good mail day. But even more than that, we all love a good Amazon delivery day. Sign up to deliver for Amazon Flex and start making money (and putting smiles on people’s faces).
4. Get creative.
Do you have any skills in graphic design, writing or other freelance-type work? Check out Fiverr. This site will connect you with more creative opportunities. You’ll get the satisfaction of creating something beautiful while making even more money.
5. Walk the dog.
If you have a flexible schedule and are physically able to walk, you might want to look into becoming a dog walker. Rover allows you to make money by walking Rufus or Buddy around the block.
There’s no shortage of ways to make extra money when you’re in a pinch. And we have even more ideas where these came from.
No matter where you’re at in the month or how much money you have left in your wallet, it’s important to get on the right track. Being in control of your money will be the reason you can leave money stress behind once and for all—and we’ll show you how.
Sign up for a free trial of Ramsey+ and learn how to manage your money, pay off debt, and budget with the best of them. It’s a money plan for real life. With Ramsey+, you’ll be able to learn with life-changing courses like Financial Peace University, budget with our premium tool, EveryDollar, and track your progress with our new BabySteps app!