Ask HN: How do I Stop Living Paycheck to Paycheck?

Increase your monthly income or lower your monthly spending. Easiest is to find a new job. If you have 14 YOE as developer you should be able to find a higher paying job as long as you&#x27;ve continually grown your skills. Put your résumé on Hired.com and put in a desired salary of $200K to gauge companies&#x27; interest then adjust up or down as needed. Do a few practice interviews on Pramp. Read up on System Design here <a href="https:&#x2F;&#x2F;github.com&#x2F;donnemartin&#x2F;system-design-primer" rel="nofollow">https:&#x2F;&#x2F;github.com&#x2F;donnemartin&#x2F;system-design-primer</a>. Watch YouTube videos on DS&amp;A and practice coding on LeetCode.

The fastest way is to make more money. You&#x27;ll probably need to switch jobs. Barring that, you need to look at your expenses. Do you have credit card debt? Start paying that off as fast as you can. Then start paying off the lower interest rates.<p>The fastest way to start saving money is to learn how to cook and don&#x27;t eat out or buy prepared food as much. You can make fresh food that is cheaper if you know how to buy raw ingredients and make your own. If you drink alcohol, cut down on how much, or find a cheaper (not necessarily worse) option to what you drink.

You need to make more than you spend. Your comp is very low so you need to change jobs to get your comp closer to where it should be. Not much else to say on this. Start leetcoding and polish your resume.<p>Edit: Yes, $110k for a tech employee with 12 YOE in a HCOL area is very very low. You don&#x27;t need to work at FAANG to make significantly more than this (see levels.fyi for many examples). The existence of poor people living on less does not change this fact or mean the OP shouldn&#x27;t strive to be compensated at a level appropriate to their experience.

The hardest part I&#x27;ve found with budgeting if you have a significant other is getting both parties on board. Then even if you get them on board you need to be together on the amounts and the methods. The budgeting part is easy once you get passed that. I&#x27;ve tried things like YNAB in the past, but without the other person on board and&#x2F;or using it, it just became useless.

there&#x27;s a ton of information missing here, but my simple way is to not really stop living paycheck to paycheck, but instead hide the money from myself before i can spend it. To me this means high contributions to retirement accounts, auto transfers in to brokerage account, and auto transfers into a separate &quot;large spending&quot; account. That way I&#x27;m free to spend guilt free anything left in my checking account.<p>The automation is really the key for me, move the money before I can spend it. But NYC is also an expensive place to live, and I could easily see 110k not being enough to live there. but maybe someone else has more relevant experience

1. Need to identify the monthly cost of your lifestyle. Housing, bills, credit card interest payments, loans (auto&#x2F;boat&#x2F;RV&#x2F;peloton&#x2F;etc), insurance, kid activities, food, etc. In other words, how much money does it take each month to run my family (or if no family, just yourself).<p>2. Each month you must put some amount of your earnings in to an account for savings. While the savings account grows over time the balance will eventually become multiples of the value from #1.<p>For each multiple you have from #2, you are then resilient for a single month. And now breaking the paycheck-to-paycheck cycle.<p>I&#x27;m sure someone will disagree or offer different advice but this is how I see it. Another person might suggest to aggressively pay off your home or have zero debt. All are of which are noble goals.

My wife and I are planning for retirement and one of the super helpful things we started is using a budgeting app and diligently planning and then tracking every penny. I suspect you&#x27;ll find a few areas you can cut back and also start putting away some amount each month.

It&#x27;s not difficult to do, but it is hard. Cut as many expenses as you can. Examples: cook your own meals instead of eating out; bring a lunch from home; shop for groceries more carefully - use coupons, get stuff in bulk &amp; freeze it; build some security into your food supply - get extra cans of corn or boxes of macaroni when it is on sale - the stuff lasts forever; don&#x27;t buy anything unless you absolutely need it.<p>At the same time, eliminate debts as quickly as possible. Start with high-interest credit cards - eliminate them one at a time, then ensure you pay of the one remaining card every month so there is no interest. If you have a car - do you need it? If you&#x27;re in&#x2F;around NYC you could take public transport for most things and eliminate the car payment, insurance, maintenance, etc. If you need a car sometimes then consider renting it only when you need it.<p>Housing - could you live a bit further away for cheaper &amp; commute in via train? Have a roommate?<p>Cut back on entertainment - wait for movies to come out on TV, eat in, use the library - it&#x27;s a great resource and costs nothing.<p>Main focus is on needs vs. wants. You NEED a 1 month cushion of cash in a savings account to cover any emergencies w&#x2F;out resorting to credit cards. It&#x27;s nice to have 3-6 months. So start with a few $hundred and just keep adding to it.<p>My wife likes the Dave Ramsey books - they seem to offer pretty solid advice. There is no reason to be living paycheck-to-paycheck, even in NYC, if you&#x27;re making 6 figures. It may not be as fun or glamorous, but it is completely doable.

Firstly, you&#x27;re being underpaid and living in a high COL area. Find a new position either remote or with correct market valuation for your level in NY if you don&#x27;t want to move.<p>Secondly, you can pretty much follow the typical line of advice when it comes to personal finance. Build an emergency fund, pay off highest rates of debt first, contribute the max to your 401k&#x2F;roth ira&#x2F;hsa, invest the rest.

Try budgeting. I’m using and can recommend YNAB but really excel or sheet of paper will do just fine. Plan every dollar you spend upfront and then adjust, learn and repeat. After few months you will know much more about where your money goes and that should help you control it better. Good luck!

Either spend less or make more. Have you started interviewing yet? You can get a lot more than $110k in NYC.

It&#x27;s not difficult to do, but it is hard. Cut as many expenses as you can. Examples: cook your own meals instead of eating out; bring a lunch from home; shop for groceries more carefully - use coupons, get stuff in bulk &amp; freeze it; build some security into your food supply - get extra cans of corn or boxes of macaroni when it is on sale - the stuff lasts forever; don&#x27;t buy anything unless you absolutely need it.<p>At the same time, eliminate debts as quickly as possible. Start with high-interest credit cards - eliminate them one at a time, then ensure you pay of the one remaining card every month so there is no interest. If you have a car - do you need it? If you&#x27;re in&#x2F;around NYC you could take public transport for most things and eliminate the car payment, insurance, maintenance, etc. If you need a car sometimes then consider renting it only when you need it.<p>Housing - could you live a bit further away for cheaper &amp; commute in via train? Have a roommate?<p>Cut back on entertainment - wait for movies to come out on TV, eat in, use the library - it&#x27;s a great resource and costs nothing.<p>Main focus is on needs vs. wants. You NEED a 1 month cushion of cash in a savings account to cover any emergencies w&#x2F;out resorting to credit cards. It&#x27;s nice to have 3-6 months. So start with a few $hundred and just keep adding to it.<p>My wife likes the Dave Ramsey books - they seem to offer pretty solid advice. There is no reason to be living paycheck-to-paycheck, even in NYC, if you&#x27;re making 6 figures. It may not be as fun or glamorous, but it is completely doable.

Do you live in Manhattan? 110k in Manhattan is a bit tight to be honest. Also 110k seems quite low for a Tech Director. In NY the average for a Tech Director salary is 160k-240k<p>My first recommendations to you would be consider looking for other jobs, and see what you can make elsewhere. Just do some job interviews. I know you worked at that company for a very long time, but sometimes a switch is needed to bump the salary. Our company is hiring a Director of Engineering btw (in Boston if you can consider moving), check the job listing just in case: <a href="https:&#x2F;&#x2F;maark.bamboohr.com&#x2F;jobs&#x2F;view.php?id=76" rel="nofollow">https:&#x2F;&#x2F;maark.bamboohr.com&#x2F;jobs&#x2F;view.php?id=76</a><p>My second recommendation, if you live in a high cost of area, consider moving, I know this is not for everyone, but I personally moved to upstate NY and just go to the office from time to time. My mortgage for a house I&#x27;ve build and is 2600 sqfeet is less than 25% my salary. Again not possible for every job, especially if you have family nearby, just throwing it there.<p>And last recommendation, is whatever your salary, have a solid financial plan. It doesn&#x27;t mean that you can afford a Tesla and your colleague has a Tesla, that you should buy a Tesla. I personally still drive an 11 year old car, I pay Verizon prepaid instead of contract, mostly to have money available for things I truly love. Even if you make 1M$ a year, have a budget. If you have credit card debt, or any sort of debt other than Mortgage, I recommend checking out Dave Ramsey, his philosophy is a bit extreme (he is entirely against Credit Cards), but it can show you a way out if you are drowning.

$110k per year for a tech director in NY sounds ... low from what I know of the market there.<p>Maybe interview, 2-3x your salary and keep the same the living standards?

There are a lot of great feedback posted already. However, I&#x27;d like to suggest looking at it differently. I&#x27;ve gone through job&#x2F;pay upgrades many many times and lifestyle also gets upgraded as well. None of those ways truly&#x2F;quickly works unless you sacrifice a lot!<p>The one approach that finally got me financial freedom and relaxed happiness was to take up side investment activities. The process and nuances will vary based on where you live, geo-economical opportunities and your current &quot;valuable assets&quot;.<p>I&#x27;m in IT and high tech and wife is in personal finance. We saw equity on our house and both me and wife have perfect credit score. We took out equity and lines of credit and bought a demolition house project with Tier-A mortgage (bank low interest mortgage). That house already had the permits but previous owner was scared to go through the actual build. We got a B-Lender to help &quot;new construction&quot; costs (they give you money phases by phase as you progress through the construction) but the interest is 3-4x bank mortgage. It didn&#x27;t matter to us because typically the whole loan duration is 1-1.5 years.<p>Important to mention we hired a professional builder (a long vetting process) to oversee the whole project as we didn&#x27;t want to get involved with day to day labour and contractors ... we just managed the taste&#x2F;style and money. The builder usually gets paid after the project is finished but we made a deal to pay half after the house sold.<p>Long story short, for every $1 out of our pocket, we got $3.25 profits before taxes and the whole thing took 20 months. We now repeat this process with 2 or 3 projects every year. NOTE: we don&#x27;t put all our eggs into this basket (2008 housing meltdown anyone). We&#x27;ve started hedging into other investment not closely related to housing.

Eat in. Drive an older car, or bike. Work remotely. Live where rent is not astronomical. Reduce alcohol consumption, especially at bars&#x2F;clubs.

There is a lot of great advice in this thread here. And as you see if parallels the same advice as dieting; do more beneficial activity and do less non-beneficial activity.<p>If you can start saving $100 a month, and ramp that up over time you&#x27;ll see yourself become more secure and less anxious in a relative short time.<p>From your spending, everything is in line with a comfortable lifestyle. Of your expenses, only the food and car seem like opportunties to diet. I would suggest finding a way in to a second hand car for half you monthly cost, and trying to get your monthly food budget to around $800. Eat out less, eat less prepared meals, and ask your children to help prepare meals.<p>For the &quot;exercise more&quot; side of things, finding a higher paying job is the simplest way forward. Perhaps the most straightforward way there is to ask for a raise, but also understanding your market value by interviewing may be beneficial. When you land an increased salary, don&#x27;t change your spending habits.

You don&#x27;t mention a spouse, so I assume there isn&#x27;t one.<p>It looks like you&#x27;re spending roughly $800 a month on &#x27;shopping&#x27; and &#x27;credit&#x27;. or almost 10% of your income continually every month on those two items.<p>Many of us do that in an attempt to &#x27;live a lifestyle&#x27; or &#x27;conform to an image&#x27;. &#x27;Image&#x27; and 5 bucks buys you a cup of coffee. Ever notice how rich people often look like they don&#x27;t even have two cents to rub together?<p>You don&#x27;t have to do it forever and a day, but stop completely any non-essential (and I mean non-essential) spending until you knock that credit card debt off your list of expenses. Eating out is one of the worst non-essential spending drains.<p>If you <i>have to use</i> a credit card for some reason, maintain a credit balance on the credit card so that the banks don&#x27;t get to charge you that exorbitant interest. They hate that, but hey, it&#x27;s your money not theirs.

Go straight to Bogleheads.org and other sites of the type.<p>It&#x27;s awesome you recognize that you&#x27;re living paycheck to paycheck. If you manage to cut a <i>little bit</i> of expenses or earn a <i>little bit</i> more through a side-gig, you will have money to invest.<p>Investing in the right places (like your company&#x27;s 401k) can bring immediate returns through things like the employer match. Once you establish a foothold, just keep on keeping on. The savings pile will grow and hopefully you&#x27;ll get an occasional raise to step things up.<p>It really works.<p>My family is now at the point where 1 kid is out of college and &#x27;off the payroll&#x27;, one kid is in college and one coming up. These can be expensive years, so prepare for them. (Now!)<p>Dave Ramsey, Bogleheads, etc. are giving you the straight story. If you live below your means and make financial gain one of your hobbies, you have a good chance of accomplishing what you want.<p>Good luck!

Excuse me for being direct.<p>Please apply to Amazon; - They are hiring like hell. - You have nice experience (as it looks from here) - They will give you a nice compensation package (RSU &amp; amenities etc) - Work&#x2F;life balance is not bad - You&#x27;ll have a chance to look after yourself (improvement or slack off, your choice)<p>PS: You can try Meta&#x2F;Facebook too...

A critique of the dieting advice, &quot;just eat less&quot; is that it doesn&#x27;t apply to many people. On the surface a comment like that is presumptive. In 2016 when I realized I was more overweight than I ever thought I could be, I stopped eating out, stopped eating junk food, and stopped eating seconds. Eating less was the advice I needed.<p>Make sure that the advice you need isn&#x27;t just: &quot;buy less&quot;.<p>Aside from that, budgeting everything is a great place to start. There&#x27;s apps that can help, but a spreadsheet could do it too. My advice is to not pay to start saving. The more granular you can be the better too. If you have some small debts then I recommend setting aside just enough for rent and food then working to pay those off immediately. There&#x27;s no shortcut to building out a budget, so you&#x27;ll have to itemize your spending and do the math to get your baselines -- then work from there.

The only reason why paycheck-to-paycheck happens is because you&#x27;re not making enough money to support your lifestyle. So either make more money or cut something out.<p>None of the numbers you gave seem particularly jarring, but $110k as a tech director in NYC seems crazy under-market, so I&#x27;d vote for &quot;make more money.&quot;

Find someone who earns half of what you do (after tax), live like them, put half in the bank before you do anything else.

Create a spreadsheet and include the following:<p>1. Your monthly net income (what goes into your account each month)<p>2. Subtract your fixed expenses from #1 above (mortgage, bills, other things you can&#x27;t change like loans)<p>3. All of your monthly expenses categorized. Go back 6 months on your credit card bills and account statements. Download the data, put it into a spreadsheet and categorize every single expense. (Grocery, dining out, travel, sports, etc, etc)<p>4. Add up all the variable expenses in #3<p>5. Add your fixed and variable expenses together and subtract from your monthly net-income.<p>6. You will now see if you&#x27;ve saved any money historically. Now look at each category and figure out where you can trim to break even, then where you can trim even more to start saving each month. If you want to save, you need to spend less, if you don&#x27;t want to spend less, you need to increase your net take home.

Echoing what others have said, start granular budgeting and work on increasing your salary.<p>A couple years ago I finished the year feeling like I lost money, even though all my bills were paid. I painfully dug through every transaction from the year and found that I was down about $20k from the prior year. I thought I was living modestly, but I was actually buying about 3x the stuff than I would have guessed. I started with YNAB (not affiliated with them at all) and it changed my life. For the last two years, my wife and I have been hyper diligent about budgeting, meeting every two weeks (the Monday after $dayjob pays me) and make sure we are aligned. I left 2021 net positive about $50k because of this.<p>I have made $25k&#x2F;yr from side work for a few years and this definitely helps get ahead. My dayjob pays me about $150k in a medium TCoL area.<p>Best of luck!

You can be making more money. It seems like your salary is stagnant since you are working at the same company.<p>Start looking around for what you can possibly get and start interviewing. When you get 2-3 go to your current employer for a counter offer and then decide what you want to do<p>Other than that: you are paying mortgage and not rent. so you had some large sum of cash in the past (to apply for the mortgage), I&#x27;m guessing that it got spent on monthly living? you can try to talk with your bank&#x2F;mortgage issuer and lower monthly returns but making the loan longer, calculate the added interest before doing this though<p>Looking at your expenses you don&#x27;t have a lot of things you can legitimately, kids are expensive. you might be able to cut your food costs by a couple of 100&#x27;s but that won&#x27;t change the outcome that much

I don&#x27;t think this question can be answered without knowing how your money is being spent. Some people try to force savings by depositing say 10% of pay in a brokerage account (first a 401(k) or IRA should be maxed out) and the remainder in a checking account used to pay bills.

No one is saying the obvious answer. By definition, you can only decrease your spending so much. There is no theoretical limit to how high you can increase your income.<p>$110K for any experienced developer anywhere in the US is extremely low - especially one with 12 years of experience.

I don&#x27;t think this is a situation where you can&#x27;t figure out what you need to do. If you sit down and think for 5 minutes you&#x27;ll know. Maybe you&#x27;re asking because you want a quick fix, when the reality is that changing bad habits always requires a sustained effort over time.<p>There is no swamp. There are those decisions that bring you closer to your goals and the alternative is self-sabotage.<p>Millions of words have been written on how to loose weight, how to eat healthier, how to start a business, and how to live within your means. There is nothing any of us can say that hasn&#x27;t already been been said a thousand times before. If you want to change you&#x27;ll take appropriate action and if you don&#x27;t you won&#x27;t.

Only one way: You must save a substantial portion of your income (e.g. $2000&#x2F;mo) FIRST. Then treat everything after that as optional, and work with your family to prioritize those things that are important (mortgage would be at the top of my list).<p>This will be hard, and it will force you to question assumptions about what you really &quot;need.&quot; Also, try to keep in mind that there are other families with 3 children living near you that only have $90k in income, and they manage well enough.<p>Edit: And as others have mentioned, keep looking for a higher paying job. This will help tremendously, as long as you learn to save first, then spend, rather than the other way around.

You need to either level up your salary, or leave NYC.<p>I know Dave Fecak well, he runs a resume writing service called Resume Raiders (google it). Contact him and have him spruce up your resume and professional profiles. It&#x27;s super affordable and he does good work with solid results.<p>See if he can refer you to anyone who can give you feedback on salary given your exact background and qualifications. Check out sites like salary.com. Just know that the data there is limited and sometimes dated.<p>Then you have some options: (a) ask for a raise, armed with information and some good arguments around why it is justified; (b) prepare for a job search; (c) both

Apologies to ask, but with 3 kids you might have a partner&#x27;s income on top of yours? (or a stay home partner). I realize the nature of the answer might be hard, still kids clearly account for part of the problem (child care specifically)<p>Aside from that, 110k sounds low for New York city but I could be wrong

Business Analyst and Life Coach in training here.<p>Let&#x27;s assume the other given advice of &quot;just make more money&quot; isn&#x27;t helpful to you<p>&quot;Treat your personal finances like a business&quot; type advice might apply here.<p>Basically, if you want something to improve the first thing you need to do is measure it. Give yourself a chance to find common sense solutions by bringing all of your spending into the light.<p>I personally track 2 things independently and it is enough for me. Total balances, and Actual Expenses.<p>Total balances is a snapshot, I update the balances on all my accounts about once a month (you might want to do weekly at first) and save a copy. This is my pulse. I can look historically at how the balances are changing and make sure it is going in the right direction. This is where you will physically see yourself getting out of paycheck to paycheck when it happens.<p>Actual Expenses is an archive workbook with csv exports from each of my credit cards and debit cards. Leave the vendor names as they are. Copy and paste them into a new sheet and remove duplicates. Add 2* columns: Name, Category (*can add more if you want). Fill them out, create a lookup on the transaction data table to add your custom fields, and make a pivot table. See where your money is going.<p>Name is a simple easy to read version of the vendor because &quot;CVS&quot; &amp; &quot;Burger King&quot;, etc usually dont appear that cleanly on the bank statement.<p>Category is as you would guess, just a way to group related items. Personally I use 2 category columns; for example - Burger King, Fast Food, Food &amp; Drink. <i>theres a lot of room to go crazy here with detail, but keep in mind you have to do this for every new vendor you use so i recommend keeping it simple.</i><p>Link each card archive into a data model with Select on Date, Debit Amount, Credit Amount, Name, Category. Union the tables together<p>It helps to isolate bank transfers (like paying off a credit card from your checking account) so you can filter them out if you want, bc they effectively double count your transactions. The $500 debit from my checking account is $500 of transactions on the credit card - so it will look like $1000 total debits which can be confusing &#x2F; misleading if you&#x27;re unaware

Spend less. Without seeing a breakdown of your expenditure it is impossible to give more specific advice. If you don&#x27;t have a breakdown, make one.

Start job flipping. $110k isn&#x27;t enough for your job title in NYC. You should be earning $200k or so at a minimum. Your current employer is probably taking advantage of your loyalty. Don&#x27;t bother trying to negotiate salary, they might flip you another $15k or so to retain you but they won&#x27;t bump you up to what you can get elsewhere.

Open a second account and move 10-20% of your salary to that account on the beginning of the month, or whenever you receive your salary. Pay yourself first, before you pay the bills.<p>Use at least 50% of that money to pay off any short term debt, starting with the high interest debt first. Try to avoid any new purchases which are not necessary. Do you really need that new TV right now? Could you live 1&#x2F;2&#x2F;3 months without a TV if the old one breaks? Everything which remains after paying off your debt should go into short term and long-term savings. Your short-term should approach at least 4-6 months of salary, to make sure you can cover any sudden expenses without going into debt. Put the remaining money into assets like index funds. Try to increase your initial share taken from salary over time. When you get a raise, make sure to adjust the amount you put aside every month.<p>See how to change your life do adopt to the now reduced income. Eating out less and start to cook for yourself is one thing to start. Check your monthly recurring expenses, do you really need NetFlix, Disney+, HBO AND Youtube Premium?<p>But whatever you do, putting money to the side as soon as you get your salary is the most important step. Maybe start with 5% and increase disproportionately on your next raise. This is what keeps the lifestyle inflation away (Just buying more because you earn more).

I’m sure you might know python. If not it’s pretty easy to learn. I think python for finances is an excellent book and you could build your inflows and outflows very easily. You could also project the future savings&#x2F;expenses and their effects on your bank balances.<p>Edit - it’s ‘Personal Finance with Python’ Max Humber

I&#x27;ve set it up so there&#x27;s an automatic transfer between my main account (where my pay arrives) and my savings account. This way that money is not immediately available.<p>What&#x27;s preventing you from doing the same with say $100 a month, then gradually increasing that until some target level?

Can recommend YNAB[1].<p>As with debugging code, a chunk of the battle of making the state visible.<p>My wife plays YNAB like a video game, and we are buffered for several months now.<p>[1] <a href="https:&#x2F;&#x2F;www.youneedabudget.com&#x2F;" rel="nofollow">https:&#x2F;&#x2F;www.youneedabudget.com&#x2F;</a>

$110k in NYC with kids? I think moving is the move, even if you end up making less. Obviously due dilligence is required to know for sure whether it&#x27;d make sense.<p>Also try to up skills to crack $150k

Come to India, you can live in luxury with the same amount.

I suggest checking out the Mr Money Mustache forums. Specifically the Case Study forum. I was in a similar place to you (though with less children), and it took about two years of changes but I now save about 70% of my salary. It has been empowering. It came from a lot of small changes (tips) that rolled to become a mindset change. The Mr Money Mustache forums are focused on retiring early but I prefer to focus on the Financial Independence. I initially thought I would sacrifice happiness, oddly I found the opposite. However everyone is different and I wasn&#x27;t married when I started, which makes lifestyle changes easier.

You are remarkably underpaid (as others have noted). You could easily add $30k yearly increase (on the low end) with a job change.

What are you spending money on, and how strictly do you budget your monthly spending?

Where in New York? City? Or Herkimer? Elsewhere?<p>Location matters

What do your monthly expenditures look like?