Many Americans know the feeling of living paycheck to paycheck all too well.
In fact, a new survey from online lender NetCredit found that 48 percent of Americans are stuck in this cycle, according to the Credit Union National Association.
"It's important for a family to get ahead – reduce their debt and build their savings to the extent possible – before a medical event, job loss or another emergency sends them off their own personal fiscal cliff," says Jennifer Hanniford, Dupaco's assistant vice president of interactive marketing.
NetCredit identified those who are most at risk for living paycheck to paycheck:
- Those in their 30s (62 percent)
- Americans younger than 60 (54 percent)
- Families with children (57 percent)
- Families with five or more people in the household (64 percent vs. 45 percent for smaller households)
- Residents of southern states (53 percent vs. 41 percent for those in the northeast states)
Dupaco's Money Makeovers can help members – and non-members, too – break away from the paycheck-to-paycheck lifestyle. The one-on-one process can help participants find unexpected ways to save and maybe even make possible what they thought was not.
The key to success often comes down to creating, and sticking to, a monthly budget, according to Katie Palmer, a lending consultant at Dupaco's Manchester, Iowa, branch.
"Typically when members are living paycheck to paycheck, they’re not spending their money on purpose. They’re writing out checks or swiping the card without having it in their budget," she said.
During a Money Makeover, Dupaco can help participants create a realistic budget. An important part of that budget is systematic savings. Participants determine an amount that can automatically be taken from each paycheck and deposited into a savings account. The money will grow out of sight, out of mind.
"If you're able to work and set money aside, I would imagine you're going to feel more like you're working toward something rather than always feeling like you're just trying to keep up with paying the bills," Palmer said.
By Emily Kittle