There are many different reasons why you could miss a paycheck—you might be out of work or on leave. Maybe payroll bounced or you’re a freelancer. And with 78% of Americans living paycheck to paycheck, it’s easy to see why the loss of even just one paycheck could be devastating.1
We’re not going to sugarcoat it. The thought of being without a paycheck can be overwhelming. But we also don’t want to scare you. We want to give you sensible, level-headed actions to take. But first, step back and take a big, deep breath.
Did you do it?
Now, let’s look at what you can do to stay on your feet—even when you’re missing a paycheck.
7 Things to Do When You Miss a Paycheck
1. Get on a budget.
If you aren’t already living on a budget, the time is now! Making a monthly budget will show you exactly where your money is going—no ifs, ands or buts about it.
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Without a budget, you really can’t make every dollar stretch, because you might not even know how much money you have to work with. Plus, your budget will show you places where you can cut back and save money (more on that later). And you don’t have to rely on a yellow lined notebook to crunch the numbers. Give our free budgeting app, EveryDollar, a try and see how simple budgeting can be.
If you don’t have any income right now, then make a budget based on the amount of money you do have. If you have $600 left to your name, budget out exactly where each of those dollars will go. It’s time to squeeze every last penny out of what you’ve got.
Maybe you still have cash coming in from your spouse’s job or some other source, then adjust your budget to reflect that. Maybe the two of you usually bring in a combined $5,000 a month, but with the loss of one income, you’re down to $2,500 a month.
Adjust your budget to live off of an irregular income for the time being. It might be tough to switch up your lifestyle, but you’ve got to make temporary sacrifices to get through this.
2. Take care of the Four Walls.
When the going gets rough—like it is right now—you need to focus on the things you really need to survive. We call these the Four Walls. Forget the student loan payment, the vet bill and the cell phone bill (for now). The Four Walls are your priority, so pay for these things in this order before anything else:
These are the basics you need to keep going so you can live to fight another day. It’s really hard to fight when your family doesn’t have food, isn’t it? So if there’s no food in the fridge, don’t pay the cable bill.
If there’s any money left over after you take care of the Four Walls, make a list of anything else you need to pay and tackle that in order of importance. When you run out of money—that’s it. Someone on the list isn’t getting paid, and that’s just how it goes. (But make extra sure you’re paying the checkout lady at the grocery store. Remember, food is priority number one!)
Maybe you’re renting and having trouble coming up with cash because of a missed paycheck. Don’t stress out. Just reach out to your landlord and be honest with them about what’s going on. They might be able to work something out with you for the time being, but they can’t help if they don’t know. Be up front with them and pray for the best.
3. Pause your debt snowball.
When you’re just trying to make it to another day, you don’t need to pay extra on your debt. Instead, focus on piling up cash as high as you can. This will help with peace of mind until you have income again. Once life gets back to normal and everything is okay, you can pick up where you left off with your debt snowball.
You’ve been chipping away at your debt, you don’t want to see all your progress come to a screeching halt—we get it. But the reality is, if you’re missing a paycheck or two, then you’re in the middle of a crisis. So pause your debt snowball. If it’s within your budget to keep paying the minimum payments on your debt, go for it. But remember, the Four Walls come first. Don’t let your family go hungry for the sake of your FICO score.
4. Sell stuff.
Get radical here. No, that doesn’t mean you have to trade in your daily driver family minivan for bicycles. But this is the time to sell what you can to bring in extra cash. Maybe that’s your jewelry, clothes, baby items or even the second car sitting in your garage. If you know you can part with something and get extra cash in your hands—do it! Well, within reason.
5. Get a temporary job or start a side hustle.
Missed paychecks are stressful. But you don’t need to freak about it—just go get some part-time work.
There are tons of ways to make extra money out there. If you want to control your own schedule, look into driving for Amazon, picking up takeout food for DoorDash, or dropping off grocery orders with Shipt.
And even if one of those doesn’t work out, you can still take up odd jobs around your neighborhood (think cutting the grass, picking up leaves, babysitting or dog walking). Be on the lookout for opportunities that will add a few extra bucks to your pocket. When you’re missing paychecks, every little bit helps.
6. Look for things to cut.
This is the time to cut back on any unnecessary expenses that you can. Tighten it up. Stop or pause your memberships and subscriptions (like the gym, Netflix, meal delivery kits, specialty makeup boxes). They aren’t going anywhere, and you can easily get them back when you have extra cash to spend again.
Don’t forget to call your cable, internet and cellular providers to see if there’s anything they’ll do to work with you during this time. Be open and honest, and let them know your situation. You’ll never know if you don’t ask! And since you already have them on the line, go ahead and downgrade or pause your service for now. HGTV doesn’t fall into the Four Walls, remember?
While we’re talking about pausing luxuries, you should start learning the word no when it comes to your friends or significant other asking you to go out and spend money. To be clear, we’re not telling you to become a loner who never leaves the house. We’re challenging you to find some activities that cost little to no money! Ditch brunch in favor of a morning hike. Skip the concert and check out a local up-and-coming band. There’s plenty of low-cost fun you can have.
We know making sacrifices like this can feel like adding insult to injury when you’re already hurting. But keep reminding yourself: This is not forever. You’re going to make it through this! You’re making temporary sacrifices to tread water until this storm passes and you’re back on your feet again.
7. Connect with your church or local community groups.
Let’s be clear here: Try to do everything in your power first before you look for help like this. Make sure you cut back where you can and take any temporary jobs to work hard and get back up on your own two feet.
But in times of real need, don’t be too prideful to ask for a helping hand. Many churches and community groups in your area exist for situations like this. They want to help you! If going to a food bank means your family gets fed, then do it.
Working the Baby Steps While Unemployed
If you’re out of work right now, you might be wondering what this means for where you’re at in the 7 Baby Steps. So let’s break it down step by step:
Baby Step 1
Were you just trying to save up your starter emergency fund when all this paycheck uncertainty hit? We feel for you. This kind of thing is why having an emergency fund is so important—because it puts a buffer between you and the unexpected stuff that pops up in life—like missing a paycheck.
If you’ve already saved up that $1,000, you might need to pull from it to make ends meet right now. That’s okay! That’s what having an emergency fund is for. And if you haven’t hit your Baby Step 1 goal, it’s time to shift your focus. Right now, you just need to pile up as much cash as you can (and don’t stop at $1,000). Save whatever cash you can!
Baby Step 2
When you’re missing paychecks, it’s time to put Baby Step 2 (paying off all your debt except the house) on pause. You’ve got to get serious about covering your Four Walls, and you can dip into your emergency fund to do that if you need to. Remember, that’s why it’s there.
And if you’re smack-dab in the middle of paying off your student loans, guess what? All interest on federal student loans is currently on pause.2 That’s right—the U.S. government announced that your unpaid federal student loans won’t collect interest until February 2022.3 Which is good news for you if you’ve missed a paycheck (and will be for a while).
We know you’re probably feeling pressured to find some kind of a “quick fix” to this problem you’ve got on your hands here. But whatever you do right now, don’t grab a credit card and don’t take out a loan. And don’t listen to some passerby who says you should get a personal loan because rates are really low—that’s stupid advice.
You don’t want to make a reckless, knee-jerk decision based on anxiety and panic. When you’re facing the harsh reality of not getting paid for who knows how long, it’s easy to go into freak-out mode. But don’t get suckered into a credit card or loan—that will only make things worse.
As scary and uncertain as things might look right now, loans and credit cards aren’t your safety net. They aren’t an emergency fund. They aren’t going to be your savior and solve all your problems.
Believe us, taking on new debt will only make things worse, not better. A bad financial decision in this season can have a lasting impact on your money and haunt you for years to come.
Baby Step 3
The good news for those of you in Baby Step 3 is that you’ve been working on saving up an emergency stash to get you through 3–6 months’ worth of life’s expenses. If you need to pull from that emergency fund, you have some money there to use. Stop for a second and let that bring you some peace of mind. It’s not all doom and gloom, because you’ve gotten out of debt, and you’ve put in the hard work to prepare for a storm.
And if you’re in the middle of working on your fully funded emergency fund (but weren’t finished yet) just keep right on stockpiling the cash.
Baby Steps 4–7
If you’re investing in Baby Steps 4–7, you’re probably watching the ups and downs of the stock market like a hawk. We get it, but just remember this: Ride it out. Don’t pull your investments and hop off the roller coaster. Stick it out. Call up your investing pro and let them help talk you off the ledge. And whatever you do, don’t cash out your retirement accounts.
But in chaotic times, there’s more you can do than simply look out for number one. You know that whole “live and give like no one else” thing? This is the perfect time to do it. Be generous. Look for the ways you can help your neighbor and offer up some much-needed hope to the people around you. Call your local church or community organizations and ask what you can do to help those in need. We are blessed to be a blessing, and that’s the mantra you need to take up now more than ever.
Don’t Lose Your Hope
You might be losing a paycheck, but that doesn’t mean you need to lose your hope too. Hang in there! If you’re missing paychecks right now and you didn’t have an emergency fund to begin with, we’re not here to beat you up about it. But once the clouds have cleared and you get that paycheck again, you need to make getting out of debt and building an emergency fund a priority. Use our free three-minute assessment to figure out exactly what Baby Step you’re on and where to begin.
Wherever you’re at right now, just know you’re not alone in any of this. Whether your job just got cut today or you’ve already missed a few paychecks, you’ll get through this. Moment by moment. Day by day. There is hope. And that hope is worth a lot more than any title a company can give you.