How to Stay One Paycheck Ahead of the Game

Until a year-and-a-half ago, I always seemed to be under financial stress. I was getting further and further into debt, barely paying my bills, and definitely living paycheck to paycheck (at best). This was all my fault, and I decided to finally do something about it.

bookkeeping with calculator

I’m not out of debt quite yet, but things are way better. I have an emergency fund, I’ve paid off countless credit card and car loans and have 2 debts left. I plan to be debt free in a few more months. My finances (and my quality of sleep!) are much better off today than they were just a year and a half ago.

One of the biggest keys to not worrying about finances is to “get ahead” by at least one paycheck.

Here’s how I did it:

Track Your Spending…if you can

Many experts recommend starting by tracking all of your spending on a daily basis, which is good advice. I did not do this; I don’t think I had the patience when I first started getting out of debt to do it. I recommend trying, but if you can’t, don’t let that stop you from a journey toward fixing your finances.

If you don’t go ahead and track your spending, at least do this:

  1. Stop using your credit and debit cards immediately.  Stop taking other loans, either from banks or finance companies or friends or family. Stop going further in debt!
  2. Create an emergency fund. The next most important step you can take, in the beginning, is to start a small savings account if you haven’t already. Begin depositing into it regularly, at least $100 per paycheck but more if you can.  Make it an automatic deposit, the first bill you pay each payday, because you are paying yourself first!  When an emergency comes up, (and it will), it won’t be catastrophic; only a nuisance.  You need to build this fund up to $1000 as soon as possible.
  3. Cut your expenses. If you can’t find $100-200 to save per paycheck, then you need to cut some things from your spending. Eating out is the best place to start. Cable, cigarettes, coffee, and entertainment are also places to pare down.  Take this “found money” and throw to savings.
  4. Use the debt snowball methodThis method is proven to work!  Besides my blog, there are many places where you can read about the snowball method and its benefits.

After those steps, you are halfway toward not living paycheck to paycheck.

Here’s what you do next:

  1. Create a budget. Don’t stop reading yet!  It is humbling, but it’s not that hard.  List all your regular expenses (rent, car, utilities, internet, etc.) and their amounts, and then your variable expenses (groceries, gas, eating out, etc.), and then your irregular expenses (things like car maintenance or medical that might not come up every month, but break them into estimated monthly expenses — if you spend $600 a year on car maintenance, budget a $50 monthly expense). Match it up against your income.  Hopefully you are spending less than you earn.  If not, see step 3 above!
  2. Automate your bills. Get all of your bills paid through automatic deduction. For those that can’t, use your bank’s online check system to make regular automatic payments.
  3. Use the cash envelope system for your variable expenses. This is the single most important thing I have done to turn around my financial life.  Let’s use gas, groceries, and eating out as examples. Withdraw pre determined amounts on payday, and put them in three separate envelopes. You can literally see how much you have left in each category as the month progresses, and when you run out of money, you know it immediately. Trust me, this works.
  4. Set goals.  Yup, it’s the “G” word.  When do you want to retire? How often do you want to travel? When do you want to buy that dream house? Do you want to save for your kids’ college education? Setting these goals helps pave the way for good saving and spending habits.

By the time you have completed these steps, you should be one paycheck ahead of the game. Imagine getting your paycheck and it isn’t already spent?  It’s a pretty awesome feeling.  Good luck!

Picture by FreeDigitalPhotos

About the Author

By , on Feb 14, 2013
A native of NJ, trombonist Anthony Mazzocchi has performed with the Los Angeles Philharmonic, New Jersey Symphony, San Diego Symphony, San Diego Opera, Riverside Symphony, Key West Symphony, in various Broadway shows and numerous recordings and movie soundtracks. Mr. Mazzocchi serves as faculty or guest lecturer at The Juilliard School, Manhattan School of Music, Montclair State University, NYU, Mannes College of Music, and Kean University. He is director of Fine and Performing Arts in South Orange/Maplewood NJ, as well as serving as Executive Director of the Kinhaven Summer Music School in Weston, Vermont and Professor of Trombone at Montclair State University in NJ. Visit Anthony at

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  1. I really like the ‘envelope idea’ because we don’t always keep perfect track of our food/entertainment expenses during the month. Could you elaborate the benefit of automating your bill payment? Is it to help avoid late payment fees, or does that accrue any other benefit?

  2. Great work Anthony! An excellent and thorough post! Good to see you on WSL.

  3. These are great tips – my husband and I have put most of them to use over the years to build up or replenish our emergency fund!

  4. Good tips (can’t say ‘great’; I am British, after all :)). I would still stress the importance of writing everything down for about six week, though (even using one of the gadgets we have all started carrying around to make this more fun) – collecting information (any information) is boring but it is the onlt thing that provides a sound foundation for decisions on action and change. Well done on turning your finances around; did you notice that it is like sailing a boat rather than driving a car? Takes time to change the course but once there it goes like…well, like on water!

  5. Thad says:

    Thanks for a great reminder on ways to get out of debt. Congrats for the success you have had!

  6. cj says:

    What an easy to read and functional guide this is Tony! We are dying to hear how you are feeling when that last debt finally falls.

    Early in 2012 and for the first time ever, Tammy and I got our credit card balance down to 0 and it is now 0 every month. What a feeling! Now we are attacking our few remaining debts like rabid beasts! Reading posts like yours keeps our focus laser sharp.

  7. I think reading all these finance articles is getting to me. 🙂 I cut my directv bill in half last week!

  8. Do we live paycheck to paycheck? Yes, but we try to keep a couple of extra paychecks worth in the account at all times. Yes, it does help me sleep better.

  9. Good job! I can imagine you do sleep a lot better at night. I don’t know how people who live paycheque to paycheque do it – they must be living under so much stress all the time. Not a good feeling!

  10. Great tips and advice, congrats on being close to debt free.

  11. Congratulations on your success. The above is a great blueprint and some great advice. Keep up the good work!

  12. You say don’t take any more loans but credit card debt is very expensive and it makes sense to consolidate – and then don’t use credit cards.

    We more than halved our payments this way and have just finished paying £100k/$160k debt off in 3 years. There is no way we could have done that without the consolidation loan.

  13. Jose, thanks for the comment! Definitely need a budget.

  14. Jose says:

    Creating a budget is high on my priority list for anyone living paycheck to paycheck! IF you don’t know what to plan your spending for it’s almost impossible to allocate your paycheck (although I’ll admit that there are some capable of doing just that). Here’s a recent article I posted on creating a budget How to Budget

  15. Pauline says:

    Nothing better than having a little breathing room, and a whole paycheck is even better. Good luck with the last 2 debts, the end is near!

  16. Nice work Tony. I know you can see the light at the end of the tunnel. I can say that the light is really awesome to see. Great tips on helping others wrangle their debt and finally become debt free.

  17. Great job turning your finances around, I’m sure you feel like a new man. I’m curious, how that you’re truly on the road to financial security, what’s your ultimate “G word”… I mean goal 😉 ?

  18. I’ve always been a huge fan of paying yourself first. I think the main thing is that if you make it a priority then it will always get done. If you don’t make it a priority and say you’ll save what’s left you won’t save anything at all. I would have to say that tip alone is the reason I was able to get ahead of the financial game.

  19. Laurie says:

    Congrats on turning your finances around, Anthony! It really does help you sleep at night, doesn’t it.

  20. Eddie says:

    Congrats on being nearly debt free Anthony. It’s truly a liberating feeling!

  21. Great tips Anthony! Great work on being nearly debt free. It feels great to be so close, doesn’t it? I did many of these same things to get out from my debt and still do many of them today.

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