[Johnny D]

Be honest...Ill make a non-public poll.

What I call living paycheck to paycheck is at any one time having less than 3 months worth of income in your bank account or living off credit.


I'll be honest, I do have to live paycheck to paycheck a few months out of the year when my income drops. I do save thoughout the year and budget for these times, but since the economy downturn a few years ago my income has been reduced by atleast 30%.

[bumere90]

To live paycheck to paycheck is the last thing I want in life

[solefald]

i don't live off credit. If i can not buy it with cash, i do not buy it. except for the car, obviously.

[petener999]

Live within your means and you should be fine.

[Express]

lamp for sure

[Spool]

if i never gambled, i'd be a millionaire

[Greenkirby21]

depends.. im in college and all of my paycheck goes to my car/gas/food/dates/etc. But they aren't really necessities.

[DarkRider23]

If you live paycheck to paycheck and drive a BMW, then you're doing something wrong. O_O

[carogers86]

According to your definition, I live paycheck to paycheck. If one has debt on any deprecating asset it is my belief that any extra money should go towards paying off that debt instead of going into a savings account.

Example: One carries a $5000 car loan + $3000 in credit card debt and has bare minimum living expense of $2000 a month. Three months living expense in savings is $6,000. Total worth is -$2000. It also costs this person money to carry this debt in interest on the loans.

If one does not have this kind of debt, it is financially prudent to have 3 months to a year of liquid savings to cover living expenses. Pay off debt on depreciating assets first. In short, I would rather say I have a paid off car and no credit card debt with $1000 in the bank than a person who says they have $6000 in the bank with $8000 in credit cards and $12,000 in car loans.

[john9]

Thanks and I like the idea

[Johnny D]

Originally Posted by carogers86

According to your definition, I live paycheck to paycheck. If one has debt on any deprecating asset it is my belief that any extra money should go towards paying off that debt instead of going into a savings account.

Example: One carries a $5000 car loan + $3000 in credit card debt and has bare minimum living expense of $2000 a month. Three months living expense in savings is $6,000. Total worth is -$2000. It also costs this person money to carry this debt in interest on the loans.

If one does not have this kind of debt, it is financially prudent to have 3 months to a year of liquid savings to cover living expenses. Pay off debt on depreciating assets first. In short, I would rather say I have a paid off car and no credit card debt with $1000 in the bank than a person who says they have $6000 in the bank with $8000 in credit cards and $12,000 in car loans.

Youre reading to far into this in my opinion. Also, I completely disagree with your logic.

I would place half my extra funds to saving and the other half to paying off the debt. Once a sufficient savings is established you could double your efforts to pay off the debt.

What happens when your water pipes bust, out of your control and you have to pay $10k for home repairs? Your $1k doesnt cut it and it goes on that credit card you were not wanting to have an $8k balance on

What happens when you lose your job for 3 months and earn minimal income off unemployment? It plus your $1k wont go far and wont cover your mortgage. Youre having to live on credit.

[carogers86]

Originally Posted by jntar

Youre reading to far into this in my opinion. Also, I completely disagree with your logic.

I would place half my extra funds to saving and the other half to paying off the debt. Once a sufficient savings is established you could double your efforts to pay off the debt.

What happens when your water pipes bust, out of your control and you have to pay $10k for home repairs? Your $1k doesnt cut it and it goes on that credit card you were not wanting to have an $8k balance on

What happens when you lose your job for 3 months and earn minimal income off unemployment? It plus your $1k wont go far and wont cover your mortgage. Youre having to live on credit.

Pipes burst = home owner's insurance (this actually happened to my parents when I was a kid). Unemployment --> start your own recession proof business? Just kidding. I see your point, but this is where each person needs to look at their situation and use good judgement.

Case in point- I amassed $17000 in credit card debt one day in early 07'. It took me just over 4 years of strict financial discipline to knock that down to $0. I never asked for help from my parents even though they offered. I too earn my living in an industry that flourishes only 9 months a year. Three months out of the year I make 50% at best. There were times where my total credit card debt would be knocked down to 5,000, but then my car would need a brake job and 4 new tires so my debt would run back up to $7000. If you graphed my credit card balance, you would notice a downward trend with ups and downs all the way to $0.

In a way, I treated my credit line as my emergency savings. Not ideal, but it's all I could manage at the time. I hated having a balance and owing money and interest. That's why I would rather pay it off than have money in the bank. Any money saved felt like it had a major credit cards's name on it because I owed.

I have been hacking away at my car loan, but as soon as I entered the housing market I went back to paying minimum on loan and saved up cash for a down payment. I don't have anymore savings aside from my 3 year old 401K. I need to spend about $2000 to spruce up house and that will go on credit card. I don't spruce up house (carpet clean, new dishwasher, gas stove, 5 ceiling fans) every month so it's an infrequent expense.

My recession proof industry is entering the start of busy season so I can pay that credit card balance off next month and get back to paying off car loan after that.

Then I can start a liquid savings account after car loan. I think I covered my bases?

[donovan]

I am living comfortably, but older I get more wise I become...

1. Down sizing my vehicles...
2. Saving in certain areas
3. Sharing foods with wife when we go out..
4. Buy most things used

I get excited when I get paid and am exciting to get to the next check too lol... I would of been close to 50k but...I bought a e92 m3 lol

[TK-421]

I guarantee as this thread grows, half the people who blast those who are living paycheck to paycheck are doing just that. I'm in college so I guess idk if I really qualify as paycheck to paycheck but I don't have a shit ton saved up (pre-paying student loans with my spare cash).

[just4kickz]

Originally Posted by DarkRider23

If you live paycheck to paycheck and drive a BMW, then you're doing something wrong. O_O

this

[Seminole]

To me, paycheck to paycheck is just that, you can't afford your payments if you miss one paycheck. Having 3 months salary in the bank would be a huge relief to most people actually living paycheck to paycheck.

[DDS2015]

I qualify Living paycheck to paycheck as having next to no monday in the bank, and you need that pay check every two weeks in order to live.

I am in university and currently have no debt. That will soon no longer be the case though. What I do have is a shit load of money saved up and a vehicle thats paid off. I have never in my life carried over a balance on any of my credit cards. Paying 19.75% interest is the dumbest thing in the world. If you have to carry over a balance then you should take a line of credit IMO to pay off the credit card at only 3%. I'm 22 and I am very blessed to have had parents that were well off financially and they showed me how to be responsible financially. That is why I have perfect credit. Banks beg me for my business. Then I tell them I'm a student with no income and they pull the deferred payments crap on me. I hate it when that happens.

[silvergray545]

I love lamp because I'm a student. (I guess that means paycheck to paycheck for me)

[dre_2ooo]

Originally Posted by solefald

i don't live off credit. If i can not buy it with cash, i do not buy it. except for the car, obviously.

Same. Only financing is car and house.

[SS32]

3 months of salary is not paycheck to paycheck. If it was, it wouldn't be called paycheck to paycheck.

[AU335i]

Originally Posted by Greenkirby21

depends.. im in college and all of my paycheck goes to my car/gas/food/dates/etc. But they aren't really necessities.

this applies to me as well.


p.s. would it be financially irresponsible to get a loan to mod my car even if I have a steady job and just impatient? just wondering haha

[ragingclue]

Originally Posted by SS32

3 months of salary is not paycheck to paycheck. If it was, it wouldn't be called paycheck to paycheck.

+1

Isn't paycheck to paycheck when you have to delay necessities (bills, rent, etc...) if unplanned expenses come about? I used to live like that and I have to say it feels much better (now that I've got a nice cushion and investments) day-in and day-out when you have a budget only as a monitoring and statistical tool, as opposed to a plan on how to get your bank account down to $0.

That being said, I don't mind people living paycheck to paycheck as long as they're being responsible about it. If they choose to live that way and they're not bothering anyone, I don't see what the issue is.