Living from paycheck to paycheck means that you spend every penny that you earn. The days prior to getting your next paycheck may be fraught with anxiety as you pray that an unexpected expense won’t force you to overdraw on your bank account. With no savings to fall back on, you’re disempowered.

You’ve dropped the reins of control over your financial security. You become easy prey for high-interest lenders and a downward spiral on your credit card balance lurks in the background. It’s time to get back in the driver’s seat and the break the cycle of living from one paycheck to the next.

Some Singaporeans end up living paycheck to paycheck for a number of reasons. According to the Economist Intelligence Unit, in 2015 Singapore ranked as the most expensive city in the world for the second year running. This makes it even more important that Singaporeans optimise their financial habits and maintain positive fiscal situations.

Fortunately, there are many things you can do to circumvent having to stretch one paycheck to the next. Here are six tips to help you alleviate the situation of paycheck to paycheck living, and find some peace of mind with regards to your finances.

Break the Paycheck to Paycheck Cycle

  1. Make changes in your current lifestyle.

Do you spend every single dollar you earn? Or worse, do you spend more than you earn? Occasional splurges are fine, but continuously living beyond your means is not. If you catch yourself always having to stretch your paycheck to the next one, it’s time to make changes in your financial habits.

Look at your spending patterns and figure out where you can cut back. The first categories to look at are your discretionary expenses. Avoid the temptation to shop for things you want but do not need.

However, if your discretionary expenses are already very low, take a moment to look at your fixed expenses. Do you need to find a more affordable apartment? Do you need to switch to a cheaper means of transportation?

Adjusting your fixed expenses usually requires major lifestyle changes. It may seem challenging at first, but downsizing can help you better your financial situation and eventually improve the level of your lifestyle without having to break the bank.

How To Save $10,000 A Year By Making Small Changes

  1. Pretend that you earn less than you do.

Living slightly below your means can help you stash away money in a savings account. By automatically setting aside a portion of what you earn, you can force yourself to spend less than what’s written on your paycheck and build a healthy savings account.

Once you begin to notice a significant amount of money left in your bank account every month, you can start stashing away even more money into an emergency fund. Try to set aside at least 10% of your paycheck for unexpected expenses such illnesses, accidents and repairs. To help you stick to this kind of system, set up monthly automatic bank transfers to your savings account.

  1. Establish a spending plan.

In order to consistently live below your means, you’ll need some realistic guidelines. Start by checking what your money is currently spent on. Then proceed by tweaking the amount of money you allocate to each of the other categories every month. Google offers a number of spreadsheet templates that you can use to make budgeting easier and more convenient.

  1. Pay your debts.

Large monthly loan payment obligations may be one of the many reasons that some Singaporeans are destined to live paycheck to paycheck. To remedy this kind of situation, commit to getting out of debt as soon as you can. For example, try to make more than the minimum payment every month.

  1. Look for ways to increase your income.

The other way to stop living paycheck to paycheck is to increase your income. In addition to cutting costs, come up with ideas on how to bring in more money into your account. For example, you may try to negotiate for a salary raise or apply for a promotion at work. If you have the time and energy, you might even look for a part-time job.

Do you have a hobby that you can turn into a small but profitable part-time business? Maybe you can explore this option. Do you have a lot of clothes, furniture or knick-knacks you no longer want? Maybe you can de-clutter your home and sell the things you don’t need.

  1. Invest for the future.

By investing, you can help the growth of the money that’s stashed away in your savings account outrun inflation. The Monetary Authority of Singapore lists various types of investments that are available. These include bonds, unit trusts, shares, traded life policies, exchange-traded funds, real estate investment trusts, structured deposits, contract for differences, and investment-linked insurance policies.

Seek help from a financial advisor or educate yourself on these basic types of investments and the importance of diversifying your investment activities.

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Founder @ The New Savvy
Anna Haotanto is the Advisor (former CEO) of The New Savvy. She is currently the COO of ABZD Capital and the CMO of Gourmet Food Holdings, an investment firm focusing on opportunities in the global F&B industry. She is part of the founding committee of the Singapore FinTech Association and heads the Women In FinTech and Partnership Committee. Anna is the President of the Singapore Management University Women Alumni. Anna invests and sits on the board of a few startups. Anna is also part of the Singapore Chinese Chamber of Commerce & Industry Career Women’s Group executive committee. Anna’s story is featured on Millionaire Minds on Channel NewsAsia. She hosts TV shows and events, namely for Channel NewsAsia’s “The Millennial Investor” and “Challenge Tomorrow”, a FinTech documentary. Anna was awarded “Her Times Youth Award” at the Rising50 Women Empowerment Gala, organised by the Indonesian Embassy of Singapore. The award was presented by His Excellency Ngurah Swajaya. She was also awarded Founder of the Year for ASEAN Rice Bowl Startup Awards. She was also awarded the Women Empowerment Award by the Asian Business & Social Forum. Anna has been awarded LinkedIn Power Profiles for founders (2018, 2017), Tatler Gen T, The Peak’s Trailblazers under 40 and a nominee for the Women of The Future award by Aviva



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