HR Specialist

Tips on how to make ends meet

In Pre/Post Employment Services on September 23, 2009 at 12:52 pm
Throughout the economic downturn, many companies were forced to lay off workers, implement furloughs, decrease benefits and cut salaries in order to stay afloat. Although recent reports indicate the recession is over and recovery is on the horizon, workers may still feel a pinch in their paychecks for a while.

If you’re counting the seconds until your paycheck hits your bank account, you aren’t alone. Today’s economic situation has household budgets everywhere tightening, as 61 percent of workers report they always or usually live paycheck to paycheck to make ends meet, according to a new CareerBuilder survey of more than 4,400 workers. This is up from 49 percent last year and 43 percent in 2007.

It’s not just people earning average salaries who are feeling the need to pinch pennies: 30 percent of workers with salaries of $100,000 or more report that they too live paycheck to paycheck, up from 21 percent in 2008.

Making ends meet
Undoubtedly, workers are getting creative in the ways they’re making ends meet in this economy. Some are creating a budget for the first time ever, others are taking on second jobs, and a few are scaling back on the non-necessities. Many workers even have to dip into their personal and retirement savings to pay the bills.

Depending on your age, experts suggest putting aside anywhere from 10 to 35 percent of your earnings for retirement. This is easier said than done in any economy but it’s even more difficult today. To get by financially, 21 percent of workers say they have reduced their 401(k) contributions or personal savings in the last six months. Twenty-three percent of workers who earn six figures or more report that they have also reduced their 401(k) or savings.

While some workers are reluctantly tapping into savings, others don’t even have this option. Thirty-six percent of workers say they do not participate in any programs such as 401(k), IRAs or retirement plans, up from 31 percent in 2008. In addition, one-third of workers (33 percent) report that they don’t put any money aside into their savings each month, up from 25 percent in 2008. Thirty percent set aside $100 or less per month for savings and 16 percent save less than $50.

Tips to prepare for the future
Here are six tips to stretch your paycheck and ride out the economic downturn while also preparing for the future:

1. Keep track of spending
Create a spreadsheet to analyze what you spend each month, including the money spent on those inevitable invisible expenses, such as a morning coffee, cab ride or afternoon snack. Once you can see where your money goes, you can clearly see where you can cut back. Do you really need to buy a bagel every morning for $1.99? Or, could you buy a package from the grocery store for $3.99?

2. Boost your income
Think of ways you might be able to earn a little extra cash. In an April 2009 CareerBuilder survey, one-in-ten workers reported taking on a second job in this economy to help make ends meet. If this is something you can handle on top of your current job, look into pursuing some viable options. Check out sites like for contract and freelance opportunities, or search for jobs using terms like “part-time” and “temporary.”

3. Speak up
Find out what benefits and employee programs your company offers that could help you save money and take advantage of them. For example, you could cut costs by taking advantage of flexible spending options, wellness benefits, retail discounts or transit reimbursement.

4. Use direct deposit
When you have your paycheck deposited directly into your bank account, you resist the temptation of just cashing it or getting cash back. Talk to your HR department to see how you can set this up for your next paycheck.

5. Pay yourself first
Set aside a certain amount of money every week, or from every paycheck, in a separate savings account. Try to set up an account where you can’t transfer money into your checking account online. Don’t touch it. Even if it’s only $10 a week, over time, you’ll see it add up from your regular contributions and earned interest.

6. Skip the ATM
If you have cash on you, you’ll spend it. Minimize your trips to the ATM by giving yourself a weekly cash allowance and using only that for the week. This might mean cutting back on daily lattes and lunches out, but you won’t miss it over time.


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