Living Like Each Paycheck Is My Last

How would you spend your paycheck if you thought it was the last one you would receive for a significant period of time? Probably a lot differently than if you knew you had many more to come, right?

I've tried to live like each paycheck was my last (even now that I don't get "regular" paychecks) for over a decade now. It wasn't that I actually believed I was going to be let go from my job; but I found that planning for the worst helped me strengthen my fortitude when it came to my saving habits.

The Proper Mindset

Living like each paycheck is your last is almost like shock therapy. It can help get you into the proper frame of mind when it comes to saving. While some people might consider it taking the prospect of saving a little overboard, sometimes we need a bit of a jumpstart to get us motivated to save.

I found myself practicing this particular savings technique when I first started in the hotel business and my job was anything but guaranteed. As I mentioned, it wasn't that I necessarily expected to lose my job, but I was the guy at the bottom of the totem pole, and if anyone was going to get the pink slip first, it was me.

At that time, I was out on my own in my first apartment, and my future wife, who was living with me, had just started graduate school and was taking out hefty student loans to help pay her tuition. I still had student loans of my own, hardly any emergency fund, and was only making $9.25 an hour. It was a somewhat frightening financial situation, and adding job instability into the mix, made it even more so. Living like each paycheck was going to be my last helped me make the most of my money and reduce any temptation to spend it frivolously.

Moving From Paycheck to Lifestyle

Over time, my job grew more stable. I was promoted, received raises, paid off my student loans, my wife-to-be got a job, and our overall financial situation improved. This did not mean however, that I stopped living like each paycheck would be my last.

While I loosened the purse strings a bit, there was still much work to be done. I had new financial goals to meet, still needed to bolster my emergency fund, and my soon-to-be wife and I hoped to one day be married and start a family. This meant that I had new financial responsibilities to meet, and living like each paycheck was my last helped motivate me to meet them.

After several years of doing this, it became the norm. It really wasn't hurting anything, helped me save money, and since I was no fortune teller, who was to say that my most recent paycheck indeed would not be my last? Therefore the habit stuck, and my outlook became a way of life. And since you never know what life is going to toss your way, I didn't (and still don't) consider it a bad habit to have.

Benefits

Living like each paycheck is my last pushes me toward other money saving -- and sometimes money earning -- tendencies. When ask yourself the question, "What would I do differently should the next paycheck indeed be me last?" What would your answer be?

Personally, I would do things such as downsize, reduce clutter to get financially organized and possibly make some money through resale opportunities, and cut costs. These are things I in fact do or look to do on a regular basis because of my "last paycheck" outlook. Such activities provide extra sources of income, make my financial life and life in general more organized, and reduce stress, which to me, are all wonderful side benefits to living this way.

More From This Contributor:

How One Page Simplified My Financial Life

How I Maintain My Financial Willpower

How Being Prepared Saves Me Money

Disclaimer:

The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute legal or financial advice. For financial advice, readers should consult a licensed financial advisor. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.