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Paycheck to Paycheck?

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AUTHOR: R Quinn on 6/28/2024

You have probably read the claim 70+% of Americans are living paycheck to paycheck. We usually interpret that to mean they have limited income, but tend to ignore spending which is half the equation.

Today is the last working day of the month. My pension arrived in my checking account. Money has been auto transferred to an account used to pay ongoing bills. Money has been transferred to an emergency fund as happens each month. I just paid two credit cards in full.

After those transactions the balance in the checking account receiving my pension is virtually the same as it was at the end of last month.

Could I honestly answer I was living P to P? I could but it would be absurd because during the month and every month there is significant discretionary spending, eating out, gifts to grandchildren, funding 529 accounts, etc.

To some degree that is true for nearly every family, although the discretionary spending likely is quite different from two octogenarians.

Beware headline grabbing surveys! 

 

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Brian Valentine
7 months ago

We live P to P too, R Quinn, but have much in reserves. I love it when my wife tells me we generated a few hundred dollars to put in savings in a month after paying off all the bills.
Of course, every month we are still contributing a significant amount to our company’s 401K, so I guess I’m cheating in saying we live P to P.

Dan Smith
7 months ago

Living P to P happens at all income levels. I think the higher the income the more likely the cause is spending.
Like you my checking account balance is nearly the same every month but there’s no way we can claim to be P to P when were depositing a couple grand to savings each month.

Jackie
7 months ago

Easy for you to say. My step brother is not smart enough to hold much more than a menial job. Twice, he has lost all of his savings to women who used him for his savings and paycheck. Unsurprisingly, he is not smart enough to plan for his future. You see it as a character flaw. I see it as bad luck when IQ points were being dished out.

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