Just how long could you go without a paycheque?

Canadians should learn how to budget finally. Living from paycheck to paycheck is a very tiring process, not to mention how stressful it can be sometimes. They have to understand that budgeting and therefore cutting expenses, will 100% help them to maintain their paychecks way better. It is going to help to save not only a quarter out of what they wanted to save on retirement, but much more than that. If you do it in a smart way, then cutting everyday expenses is not going to be very painful.

I could go 5 years, maybe 6 or 7 if I made some sacrifices.

well you have it all figured out.thanks for speaking for me. every one has an different situation. i have mine.pay check to pay check is a way of life for me.i could not even go a week without a paycheck.cut expenses? please.theres nothing left to cut.never eat out or order out.shopping is almost none exsistant,unless its grocery day.going out is not even thought of.retirement,there is none.as i said you dont know my situation or how i got there.i work hard and pay taxes.do i want more ,of course.ive worked my whole life.im 47 and yes there is nothing to show for it.i do however have 3 grown beautiful children.i feed them,clothed them,educated them,taught them good decent values and it paid off.they all are professional people and are well adjusted,smart, and caring individuals.do i expect anything from them.no.will they be there for me .yes.do i depend on this .no.you have not walked in my shoes nor as i say again,no of my life.cut expenses? im laughing all the way to the bank....

I was laid off in October 2009 and with a single income household, it was very frightening. In the midst of a global recession, my job prospects were slim. I survived 2.5 years without a paycheck and it was all thanks to years of "fiscal responsibility". Prior to my layoff, I lived below my means, saved money and invested in my retirement. I lived quite well, travelled often and went out socially regularly.

It IS possible to save money AND enjoy your life, with just a bit of moderation. Take a bag lunch to work, buy only 1 Starbuck's coffee per day instead of 3 or 4, use the items of clothing & shoes that you already have instead of going out to buy more just because you can, look for sales on household items and stock up, do your laundry at night to save on electricity, pay attention to bank charges especially ATM charges, etc. Arrange for automatic money transfers in to your savings account because if it's not there, you won't spend it.

By exercising, these simple rules, I managed to save enough to survive 2.5 years without changing my lifestyle too much. Unfortunately, many people today are so focussed on "keeping up with the Joneses" that they put materialism (and "Bling") at the top of their priority list. Learn to live and be happy with what you have. Find happiness and peace within yourself...not in "stuff".

I recently launched my own business and offer household budgeting as one of my services. Most of my clients are so impressed with my story of survival, they've begun to adopt a lot of the same principles. Minor changes can make a huge difference. I feel very strongly that money management should be taught in schools because money management and household budgeting are critical life skills.

Bottom line, people need to live within or below their means. Money can buy lots and lots of "stuff" but it can't buy happiness.

Citygirl, do you have a web site or contact spot?

I couldn't go without a paycheck. I still have a new mortgage that needs to be paid off and 1 kid and another on the way. With that being said, I don't make enough money to save thousands of dollars a month to build that nest egg. Guess I need a part time job.........or need to figure out what every one else is doing to live for 7 years without work.

my wife and I could go 1 or 2 years without a paycheck, we live below our means and save close to 20% of our take home pay. This is with a mortgage and a new baby, we didn't take the maximum loan the bank would give us when we bought our house because we budgeted and made sure our payments fit our budget we bought 5 years ago with interest rates higher and now renewed with much lower rates but kept the same payments this means our house will be paid in 11 years. When we want to buy something we save for it and then buy it, we don't pull out the credit cards and then pay it off with interest. Today most people just spend and spend Canadian Tire now has payment plans for car repairs and tires!!! This is clearly because too many people don't know how to budget properly if they did we wouldn't need this. Even if you put only 25-50$ a month aside you'll at least be starting to build a fund that will get you out from under the stress of living paycheck to paycheck.

Well I think two years would be my limit. Costs our household fixed expenses are 4800$ plus what little we spend as all cuts have been made. Then we would have to tap out all plc cc"s and will be in trouble. Or then I start spending my retirement savings

I could go for maybe 6 months without a paycheque, but that's only because I've been lucky for a number of years (not laid off, no financial emergencies, etc). It really is true what they say - even if you can only save a bit (like me), if you do it for a long enough time (10 years or so in my case), you eventually have savings!

To "Looking for help" or anyone else that it interested in money saving tips or building a sensible household budget...

Email me at: mary@creatingequity.ca

Excellent comment and story CityGirl. Hope many people take you up on your advice and start living within their means.

I've gone two years when we traveled the world before the children arrived.
I rationalized it this way.
When I reach retirement age all retirement savings accounts and government pensions will have been stripped bare or looted by successive governments. My early trial run was to prepare me for the inevitable.
Don't worry folks, you'll have a chance to have a go at living without a pay cheque at some point in the future. Might not be a bad idea at this point in time to come to the realization that the value of your house won't go up forever. And that when you are going to want to sell & cash out for retirement, so will one third of the rest of the population.
If you're in doubt about how it will all play out, read up on personal experiences of Russians when their government issued new currency during their economic crisis we all happily ignored.

To "Really!!!"...

I'm a mortgage agent by trade and early on discovered that most people have no idea about handling their finances. During the course of arranging a mortgage for a client, budget and purchasing limits usually comes up and when it does most of my clients express an interest in learning more. We talk about the challenges and their issues, I build a proposed budget for them and after the deal is closed, I'm hopeful that they execute but it's actually their choice.

Having said that, I've had a few that executed the plan so completely, they were able to pay off their outstanding debt and save enough money for a down payment within 18 months.

In addition, my business has grown more through "previous client" referrals than any type of marketing that I've done...so my logic is that I must be doing something right! :)

Many Canadians don't understand that you do not live off your paycheck. You live off 3/4 of your paycheck and you bank the rest. Live below your income! Second, many Canadians live off future paychecks ie credit cards and bank loans. That puts the stress on each paycheck. I switched to cash only 12 years ago. If I don't have the cash and then some, I don't buy something. My life was instantly better! I live below my income and I pay cash when I have enough. Time to stop keeping up with the neighbours (who likely live paycheck to paycheck) and just keep pace with 3/4 of your income. Aaahhhh...exhale and relax!

I was a financial planner for the last 15 years of my career. So easy for me to say how to handle your funds, also I am now retired. I do remember coming to this country with 3 children and 3 suitcases. For many years we had to live paycheque to paycheque, the stress was terrific, but making our way in a new country was worth it. My husband became ill , I had to become the breadwinner for twenty years, before he passed away.
I do not have to worry about funds at this time, but how I would have loved to have known this type of security all those years ago. I have children who are teachers now. Good citizens all. But we cannot attempt to stand in others shoes and tell them what to do, they al have their own reasons for not saving, maybe on basic salary. siockness, disease and unemployment etc.
So easy to give advice without knowing the circumstances.

Ive been over two months thanks to a previous employer not submitting roe on time and incorrectly filled in by another. UI has about two months to process a claim. They cant deny it but tht does not stop them from taking as long as they please to send you your money. Paid into it for 35 years can not access what ive funded for over two months sweet.employers have one month to submit your ROE but I guess they can do what ever long as unemployment does not have to pay what is legaly yours. Sameeimploye rcalled me a cripple victimized me belittled and made the scapegoat for all ills I guess labor laws and decency are dead and gone in our society. Too to two sad for canada most of my reletives fought for this country for demosracy now we have harper and brad wall.They only care for buisness and who ever pays for the campaign

Hi,

I have a question: when you talk about savings where do you put the savings? Do you invest? Do you put it on e-savings or ?
City Girl's comments are very good! Did you invest in stocks? or on retirement plans?
Thanks!

To city girl, it is great if you have it all figured out, but it sounds like you are putting down anybody that doesn't. My husband and I work very hard and try to save our money, but the reality is, life is expensive. We have three kids, and after the cost of regular living, we have no spare change for anything. And it is nt a case of budgeting. We have been out to dinner only 3 times in our 6 year marriage. We have 1 family cell phone for emergencies only, none of us have any electronics or gismos or gadgets. We have no extra curricular payments of any sort. So you tell me how I should be able to save money when our bills leave us with about $50 a week extra, and it goes toward gas to go to and from work? I despise the commentary that anybody who is not saving money is wasting their money. 6 years Later, we still want a honey moon.

To ASIF... I do not look down on people that are struggling nor would I ever. My comment simply explained what I did to save money and reduce my costs. Interestingly, since I posted my contact info, I've received emails from several people asking for tips and I've happily obliged. Having said that, I do think there are a lot of people out there (not everyone) that are not realizing the actual "cost" of their daily habits and spending. Sometimes we don't even "think" about what we are doing...we just do it because it's a habit. In my case, I happened to notice the spending and took steps to change it in my life.

To International...Most of my savings were in Tax Free Savings Accounts and RRSPs with a little in mutual funds. I've always been hesitant to invest heavily in the stock market, simply because I didn't have the time to learn enough about it to make an informed decision. I think there's a huge opportunity now to invest in stocks, because, in time the market will come back. The question is whether you can wait long term to reap the rewards. (I'm not a financial advisor - it's just my opinion.) Having said that, I was glad that I had most of the money in liquid assets because as time dragged on and the job market was awful, I had to draw from these assets in order to keep a roof over my head.

will i could not last long with out a pay check as a senior and what i get i couldnt last a day my payments and expences take care of my check of 900.00 and usual i have nothing left to get any food i have to go hunting just to get food to eat i live on rabbits ducks partredges sea gulls what ever i can get but i only ever eat rat once i dont ;ike rat dont taste very good i have ate bob cat its very good beaver if i can get any some times ill fine a moose that some one as killed and ususl they leave the heart and liver kidneys the head and tounge are very tasty and some times i can get a seal from the ice or the beach but when you get old its hard to get any thing and the government they dont care if you live or die will this is all i have to say now till next time hardy living

It's possible to save.. the best way to save is to stay home. As soon as you leave you'll spend ..and spend more than planned. Look for grocery savings, it's like gaining money. I lost my job in 2006 and had to succeed or die. Started my own business, websites, sleeping only 4 hours per night, then started investing and studying. Now I'm almost retiring and haven't even reach 35 yet. Sometimes, a negative thing like losing an useless job, can turn into a positive thing, but you don't know it instantly.. we're all survivors and the human mind shows it to you the best when submitted to struggle. Better days are coming ahead for the wise man. Tony - From Central Banks and Big Players