Barely treading water? Tips to help you stay afloat.

A reader writes in with a common problem: She lives paycheck-to-paycheck, so any unexpected expense makes her fall behind in her bills.

J. Pat Carter / AP / File
Maia plays in the Totally Dog day care swimming pool in Miami, Aug. 17. Many Americans spend everything they make, barely treading water financially and feeling in constant danger of drowning from the next unexpected wave of expenses.

Katie writes in:

The article on budgets was *great.* I’ve long felt guilty for not doing the whole formal budget thing, especially since I always liked and did well at math. (Like you, however, spreadsheets cause my eyes
to roll back in my head.)

But here’s a question/comment on one bit. You said: “First, this doesn´t work if you´re already spending more than you make. That type of behavior is not sustainable. If your credit card balance is going up each month, no amount of budgeting or planning matters until you´ve reached a point where that credit card bill goes down each month.”

We don’t have ANY credit cards, so that’s not a problem. To be honest, I doubt if any credit card company would give us the time of day. (I do want to get a secured card at some point, with the goal of rebuilding a bit of credit.)

But we’re currently at a stage that’s a variation of what you described. Since we can’t use a credit card, we often wind up playing a sort of “musical-bills” game with such things as our electric, water, gas, trash, phone and so on. By this I mean that we will either skip a month of paying one of them, or make a short payment on one or more. The next month, we try to catch those up, but sometimes then need to repeat the process with another bill going short.

Occasionally we get a small windfall: selling something, or a gift of cash for a birthday, or the like. This usually goes into making sure *everything* is 100% current… which is a wonderful feeling! But then comes a month (such as this one) where the power bill is extra-high, or gasoline prices spike just as I need to make several trips into the city for doctors’ visits. When that happens, all too often the following month begins the cycle once again.

Beyond the standard advice on cutting back as much as possible, or earning more, do you have any particular suggestions to help get us off the merry-go-round? I know the best solution is to have more coming in, and I am hoping (now that my medical issues are being dealt with properly!) I can get back to writing and actually SELL something again. But meanwhile, treading water has gotten rather old.

Many people find themselves at this “treading water” stage and are unsure how to get past it. Basically, it amounts to spending almost exactly what you earn, with the irregularities from month to month causing trouble.

The solution here is usually just a few pebbles on one side of the balance or the other, just enough to cause the tipping to begin.

Where can you get those pebbles from?

A bit of extra income This is the perfect type of situation for some small-scale earnings online doing things like Mechanical Turk (see my notes about it) while you’re watching television or relaxing in the evenings. You’re not really looking for a job per se, but something that can earn a little bit whenever you have a few spare minutes to work.

A bit of extra diligence You don’t need to make radical cuts. You just need to be a little bit extra diligent when it comes to your spending. When you’re standing at the checkout line, make the conscious choice not to buy a pack of gum or a People magazine, for example. Get just a sandwich and a water cup without the value meal – you don’t need the fries anyway. Then feel good about the little choices you made – and watch as they slowly add up to a better balance at the end of the month.

A bit of sharing Go in with a friend or three and get a membership at a bulk-buying warehouse. Go there to buy your toiletries and split the cost on jumbo packs. Buy a four pack of deodorant, each of you take one of them, and reduce your deodorant cost by about 30%. Do the same for paper towels, toilet paper, milk, garbage bags, and countless other things. Go beyond that and share larger things with your friends – you don’t both need a toolkit. Just put tools in one kit and pass it around as needed, for example.

A bit of self-improvement Spend your evenings learning about the things you’ve always been curious about. Check out books from the library on it, or surf through Wikipedia on the topic. Try doing the things you learn about. Learn about a topic – and learn how to learn, as well. You’ll come out of it with more knowledge and perhaps more skill – and it won’t cost you a thing for entertainment.

A bit of mutual support Support your partner when he does things that are financially smart. Reinforce the idea that spending less is the good thing to do. You’ll find that with people around you supporting this kind of behavior, particularly the people you spend the most time with, it becomes more natural to spend less money.

A bit of friendship This attitude spreads to your closest friends as well. Don’t be afraid to admit that you’re having financial challenges. Be willing to talk about money with them and encourage each other to make better choices. Engage in non-expensive activities together – most activities are made fun by the people you do them with anyway.

Many situations are made a lot better by doing just a little bit of a lot of different things.

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