Thursday, December 09, 2010

How to Stretch Your Paycheck

Unemployment is now at 9.8%. Some Americans have moved down an income level from upper-middle class to middle class, middle class to lower income or lower income to poverty due to the economy and job market. Many Americans are forced to live on less money while other Americans are finding it difficult to live on less for several reasons: 1) they don’t know how, 2) they don’t want to or 3) they are in denial. Here are some helpful tips to help stretch your paycheck in a tough economy.

1. Bulk. Buy items in bulk by shopping at wholesale or discount stores such as Costco, Sam’s Club or BJ’s.

2. Budget. Create a spending plan or budget to see what areas you can reduce spending. Thirty-five percent of your budget after taxes should go towards housing (mortgage/rent, utilizes, repairs), fifteen percent towards debt (credit cards, student loans, personal loans), twenty-five percent towards transportation (maintenance and car payment), ten-percent towards savings, and fifteen-percent towards other expenses (groceries, prescriptions, medical expenses, etc.).

3. Comparison Shop. Look at prices of at least three different companies to see which has the best deal. Ask if the company will honor competitor prices.

4. Online. Look for coupons and specials at online websites such as or

5. Generic. Buy generic brands for food, canned goods, paper products, dry goods and prescriptions.

6. Utilities. Buy the cheapest landline plan available. Turn to the lowest settings when you are not at home and use the recommended settings provided by the utility companies to save money on your monthly bills.

7. Bundle. Bundle services to save money on insurances such as car, mortgage and homeowners.

8. Downgrade. Downgrade all your services such as cable, internet, and cell phone. Downgrade your car or home to a cheaper model. You can sell your car and catch public transportation. If you need a car you can rent a car or use a Zip car.

9. Eat at home. Skip buying lunch every day and eating out. Cook meals at home and take leftovers for lunch.

10. Get assistance. Borrow money from friends or family members. Apply for government assistance, get help from your local church or get assistance from social organizations like the Salvation Army or American Red Cross.

11. Sell Items. Sell new or used items on eBay or Craigslist for extra cash.

12. Multiple Jobs. Work multiple part-time or full-time jobs; work a combination of full-time or part-time jobs to make ends meet. Do odd jobs such as cleaning homes, shopping for the elderly or babysitting to earn extra money.

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