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The “Trying To Make Ends Meet” $100 Giveaway

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No matter what our financial situation, everyone should have a budget.  I mean, everyone!  Budgeting allows you to assess how you are doing monetarily and make changes to make sure you will have enough money to cover your expenses.  The best rule is to make more than you spend.  It is the general basis of personal finance.  Most, if not all, of the readers of Debt Roundup have a budget or are working on one.  You should be budgeting out your monthly expenses along with your monthly income.  We all hope to have a surplus on the credit side.  But what happens when we don’t?  What happens when we cannot make ends meet and it is now the end of the month and there is nothing left in the checking account?  What do we do?

I have been in the situation of not having enough to get through the month.  This was usually do to a small emergency fund and an unexpected bill that arose, like car repair.  While I have fixed the emergency fund issue, it is always an struggle to deal with an expected expense.  If they were expected, then they would be in the budget already.  If you are approaching the end of the month and your finances are looking depleted, then what should you do?

There are two choices that I tend to make depending on the scenario.  These choices might not work for everyone, but they can if you use them properly.

  1. Ask A Friend or Family for a Short-term Loan – Hopefully you have some friends or family to ask, as this is a great choice if you can use it.  Family usually are willing to help you and if your are only in the hole a small amount, then they might be willing to lend you the money.  The key to this choice is to come up with a quick, written contract on your payback terms.  You should always make sure your friend or family member knows when they are going to get their money back. Make sure to add the loan into your next months budget.
  2. Use Your Credit Cards – This choice can be dangerous, but that is what I use my credit cards for.  They are my emergency beyond a normal emergency fund.  Since owing the credit card companies $50,000, I am very careful on when I use them.  If you have a reasonable interest rate, then it might be wise to use it to purchase food or pay your last monthly bill.  It would be better to revolve that debt until the next month, then to default on your bills.  You can ruin your credit report really quickly by defaulting on bills. The key is to make sure that you pay off the amounts that you charged. Don’t get complacent and only pay the minimum payment. That will just result in more financial mess.

There is one choice that I do not advocate to anyone and that is Payday loans.  I think the lenders are aggressive sharks that charge astronomical interest rates that hurt the very people they are supposed to help.  No one wins when you are being charged an interest rate of 800%, except for the lender.  Many payday lenders have been shut down in my state due to their poor business practices.  There are alternatives to Payday loans, such as ActiveHours, which doesn’t charge a fee, but allows you to tip them for their service.  It is a relatively new concept, but one that might be worth trying.

The one thing that you must think about when dealing with a shortcoming in your budget is what is necessary.  You must distinguish between wants versus needs.  You may want to eat out at a restaurant, but since you don’t have money, you need to settle for a cheap dinner (Ramen noodles anyone?).  There are going to be times when money might be flowing out faster than it is coming in, but you have to get control of it and figure out where you can make some changes.  Having a budget shortfall every month is not a way to live, but with some changes, you can start living on a small surplus.

If you deal with living paycheck to paycheck and are always trying to make ends meet, what do you do?  How do you deal with your finances?

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About Grayson Bell

I am an average Joe, who built up over $50,000 worth of credit card debt and had to learn how to break it back down. It took 4 years of learning budgets, secrets, and many other personal finance tricks in order to cut the debt to $0. Now, I push to teach others not only how to get out of debt, but how to use credit wisely and how to start growing their wealth. You can view my other site, Sprout Wealth for ways to grow your money. I am also a freelance personal finance writer who provides staff writing and ghost writing services.

20 comments

  1. When I lived paycheck to paycheck I also ended up maxing out my credit cards, so that wasn’t really an option for me. The only option I had was just not to pay my bills, however, I did opt for a few pawn loans. I ended up getting my items back but the annual interest rate I was being charged was outrageous.

    As was the case for me (and anybody that finds themselves in that situation) you just have to focus on increasing your disposable income. There isn’t any other solution; either make more money or spend less.
    WorkSaveLive recently posted..5 Frugal Christmas Ideas for ChildrenMy Profile

    • Very true. Sometimes there just isn’t any other way. You have to do what you need to in order to survive and if credit cards are it, then use them. If loans are it, then do it. Hopefully it will teach you different ways to be creative with the money you have and other ways to make more money.

  2. When I was paycheck to paycheck I was using cards to help supplement a life that I wanted but could not afford. That can be a very dangerous situation. Thankfully I learned the power of budgeting and got rid of that debt. Now they’re used to stretch our budget and earn rewards.
    John S @ Frugal Rules recently posted..Taking The Plunge is Not Just For Polar Bears – Part 1My Profile

    • I agree. I can see using a card here and there if you are short, but you still have to figure out why you are short those months and fix the underlying problem.

  3. There have been a few times where I had unexpected expenses that put me way over the top. One particular time I was having so many car issues and needed a new car. I ended up borrowing money from a family member. But I only proceeded with this decision knowing I’d have no problem repaying the loan, otherwise I wouldn’t be asking them.
    Veronica @ Pelican on Money recently posted..Powerful Lessons Learned in Starting an Online Store (Part 1)My Profile

  4. I definitely like your tips. While this wasn’t an emergency scenario, I shared a car with my sister while we were in high school. Our parents would only buy one car for all us kids to share, and it ended up being the one thing we fought about quite a bit (as expected…two high school students sharing a car rarely works). I gave her a 1 year loan to help her purchase a used car and she payed it all back on time. I wouldn’t recommend it unless you gain some serious benefit (which I did!), but I would definitely be willing to loan a family member money if they were in a bind.
    DC @ Young Adult Money recently posted..When There Is Not Enough Money – $100 GiveawayMy Profile

  5. Personally I would never feel comfortable asking a friend or a family member for a loan. Even as a kid I don’t remember asking a friend if I could borrow money. I just think it is the quickest way to ruin a relationship. I’ve heard many people say “only lend what you can afford to lose because there is a chance you may never see that money again”.
    Tackling Our Debt recently posted..How to Manage Your Money So That You’ll Always Have EnoughMy Profile

    • I wouldn’t have a problem lending money to a friend or family because I believe that I would get the money back. If I don’t, then that is a harsh lesson to be learned by me.

  6. Thanks for the mention about Activehours.com! That’s my company, and I’m super proud of the fact that we’re able to help people when they’re in a pinch — without taking advantage of them.
    Of course, no one wants to be in a situation where they can’t make ends meet at the end of the month, but I know I’ve been there a few times in my life (especially in college!) and something like Activehours would have been a godsend back then. Anyway, thanks again and look forward to reading more.

  7. Agree Sicorra, I would go to a pay-day loan place before asking a friend or family member. In my experience, mixing money and friendship is a sure-fire way for things to get ugly. But that is just my experience.
    Kyle @ Rather-Be-Shopping.com recently posted..Frugal Hack #2: Christmas Shopping with the KidsMy Profile

  8. I would advise someone who routinely gets into this situation to start reading PF blogs. There are lots of great posts on this topic that seem to all agree that if you don’t change the behavior that got you into that place, you can’t get free of debt.
    Kim@Eyesonthedollar recently posted..Paycheck to Paycheck is No Way to Live/$100 GiveawayMy Profile

  9. I don’t think I would feel comfortable asking a friend or relative for money. Perhaps it’s just me, but it just wouldn’t feel right.
    Glen @ Monster Piggy Bank recently posted..Ten Tips for Reducing Road RageMy Profile

    • That is always a personal decision. I don’t have problems asking friends and family because I always pay back my debts. In the past, I have created a contract with my family member which kept me on the correct payment path, so I wasn’t taking advantage of them.

  10. Grayson, what did you decide to do about your cell phone dilemma? Has your Verizon contract expired yet?

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