A $100K salary will feel more like making $36K if you live in this city — here are 5 ways to break out of the paycheck-to-paycheck cycle

1. Stay away from high-interest debt

Carrying balances on your credit card costs you more than you might realize. The average credit card interest rate is 24.56% as of Nov. 17, according to LendingTree — the highest figure on record since the online lending marketplace started tracking rates monthly in 2019.

To put that in perspective, imagine you have a balance of $10,000 at a slightly lower interest rate of 21%. Given payments of $200 a month, it would take you 10 years to pay off the balance and cost you an extra $13,972 in interest charges over and above the $10,000.

Think twice before you buy expensive items on a credit card. If you need to make a big-ticket charge, plan ahead to pay it off within a month or two in full.

Then you can dump the money you saved into a retirement account or whatever else you like. Anything beats losing large amounts of money to interest payments.

Discover how a simple decision today could lead to an extra $1.3 million in retirement

Learn how you can set yourself up for a more prosperous future by exploring why so many people who work with financial advisors retire with more wealth.

Discover the full story and see how you could be on the path to an extra $1.3 million in retirement.

Read More

2. Maximize your 401(k) or IRA contributions

Putting your future first doesn’t have to be painful and can reap huge benefits – even if you can only put away small sums of money over time.

Work-sponsored 401(k) accounts or independent IRAs are the common gateways to retirement savings. The closer you can get to the maximum yearly contributions – $22,500, or $30,000 if you’re 50 or older for 401(k)s, $6,500 for IRAs – the closer you’ll get to retiring with a secure cushion.

Sadly, saving for retirement gets relegated to the back burner for many of us, especially as the cost of living and inflation put more demands on our incomes.

What’s more, nearly 57 million Americans work for an employer that does not offer a retirement savings plan, according to the AARP.

Tweak your budget so you can find ways to make retirement contributions, even if you can’t max them out.

3. Create a budget

A budget is your lifeline to financial freedom because it takes spending from vagueness to clarity.

No matter which method you use, you’ll use the same starting point: List how much money comes in and how often you get paid. Then you’ll tabulate every expense, including the dollar amount and payment due date.

Since every budgeting method differs, your next steps can vary. Some popular methods include:

• The 50/20/30 method
• The zero-based budget
• The envelope or cash-stuffing method
• The reverse budget
• The “pay yourself first” method

It can help to remember you don’t have to stick with the first one you try. Sample different methods to see which works best for you.

Kiss your credit card debt goodbye

Millions of Americans are struggling to crawl out of debt in the face of record-high interest rates. A personal loan offers lower interest rates and fixed payments, making it a smart choice to consolidate high-interest credit card debt. It helps save money, simplifies payments, and accelerates debt payoff. Credible is a free online service that shows you the best lending options to pay off your credit card debt fast — and save a ton in interest.

Explore better rates

4. Negotiate your salary

Most people don’t negotiate a salary. A 2023 ZipRecruiter survey found nearly two-thirds of job-seekers accept the salary offered to them and don’t make a counter-offer or negotiate.

But employers expect you to negotiate. Around 85% of people who countered on a salary, benefits or both received at least some of what they wanted, according to a survey by Fidelity Investments.

While a budget is a vital component of smart spending, earning more allows you more leeway to pay off debt and save for your future.

5. Take advantage of all your employee benefits

Whether you’re scouting for a new job or like where you’re at, explore all the benefits your job (or potential job) offers.

What does your health insurance cover? Is it just for you or your dependents as well?

You should also look at options for life insurance, 401(k) matches, continuing education stipends, student loan debt matches, and more.

If your company matches retirement account contributions, it's a golden opportunity to land “free money" from your employer.