Do This With Your Paycheck Every Time You Get Paid

In 2023 the average salary was right around $60,000 and nearly 78% of these people were living paycheck to paycheck. You don’t have to continue to be part of that 78%, and you don’t have to feel sick and tired of getting up every day and going to work, getting paid on Friday and by Tuesday you’re wondering where your check went. 

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I want to explain to you the four money-proof things you need to be doing with your paycheck every single time you get paid because I’ve been there. These are going to help you understand what you need to be doing and how to build wealth and become financially independent. 

Utilize and take advantage of a great checking account 

You need a checking account that doesn’t have any hidden fees, that you can access anywhere and benefits you. If your current checking account doesn’t do this for you and you are hit with constant service fees, it might be time to sit down and consider other options. 

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There are a ton of great checking account options out there that can help you better manage your finances. Chime is a great example of a checking account that allows you to get paid up to two days early with direct deposit, no hidden service fees and overdraft fees, and you get access to fee-free ATMs. You want a checking account that is going to work with you and keep your money where it belongs, one step closer to getting out of the 78% of people living paycheck to paycheck. 

Check your budget 

Your bank account will lie to you – it’s not going to really tell you everything you need to look for in the future. There are certain checking accounts that after a certain amount of time with a pending balance, the hold will fall off and the money will go back into your account until it’s processed, so if you’re not sticking to a strict budgeting and tracking your spending, your bank account is going to lie to you. 

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If you’re not spending the time to sit down and budget, you don’t care about your finances and your money. The budget needs to be created before the month starts, so that when you do get paid, you know exactly where your money needs to go. Having a budget and staying consistent with it means you already spent the money on paper before you get your paycheck. 

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This also means you need to review your budget before any kind of purchases because the budget prevents overspending and you accomplish your financial responsibilities. Stop letting your paycheck tell you what you’re going to do, instead start telling your paycheck what it will be doing. 

Automate your money 

Turning on automations will help you in the long run when it comes to building wealth and managing your finances. By setting up automations you’re not leaving it up to you, before you even see the money it’s put where it needs to go. 

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You can set up automations for money from your paycheck to go into the bills you need to pay for, a high yield savings account, giving and contributions to charities or churches, and investment accounts. The automations you should have set up no matter what, are your mortgage or rent and your utilities, things that you know are consistently going to be the same. 

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Once your automations are out of your paycheck, the rest of the money is being operated off of the budget you created, and you should be sticking to that budget consistently. 

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Pay off your debt strategically 

The debt you have is robbing you of your financial future, so you need to be using the debt snowball method to pay off your debt. This isn’t something you can't sit back and ignore, it’s something that you need to have in your budget and spend every Friday paying off debt. 

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Your debt is stopping you from enjoying your paycheck and creating a margin, so within the next 12-24 months you need to spend considerable time, using the debt snowball method, to pay off your debt. 

Spend wisely on non-essentials

Separate the wants from the needs and determine what you really need and what are the things you don’t need but want. Needs have to be taken care of first, which is why it’s so incredibly important to have a budget and stick to it consistently. When your needs are taken care of, and your debt is paid off, and your money is automated, you can determine the wants you can spend money on and what is within your budget. 

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When you get your paycheck, spend money on the things you need first and the things you desire second - otherwise you’re going to stay where you are. Living paycheck to paycheck or even paycheck to two days before paycheck. 

Making better financial decisions 

Often the reason that we make poor financial decisions and spend money frivolously is because we don’t sit down and figure out why we’re spending money this way, or why we’re spending money on the things we’re spending money on. 

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A big part of building wealth is mental wealth and wellness, not just monetary wealth. When you’re able to step back and evaluate the reasons behind your purchases and why you’re spending money without purpose or discipline, it can help you reevaluate your financial habits and make better decisions. 

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Talking to a partner, family member, loved one, or friend can help you take a step back and figure out why you have certain financial habits, but therapy can too. Betterhelp is a great resource to address mental wellness as you’re building your wealth.

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Let’s Recap

While 78% of people live paycheck to paycheck you can still make it out of that 78% by following these four steps every single time you get paid. Ensuring you have a good checking account that works for you and has benefits like no service fees or overdraft fees. Creating a budget for yourself and setting up automations to cover your needs which then allows you to strategically pay off your debt using the snowball method. 

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By doing these things every single time, you’re going to set yourself up for a financial future where your paychecks don’t control what you do, but instead you tell your paychecks what they’re going to do for you. You can get out of that 78% and start investing more in your financial future.

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