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Bottom Line Up Front

  • You need a budget to keep your expenses under control and emergency savings to handle the unexpected.
  • Part of the strategy is to pay down debt steadily, starting with any high-interest-rate debt.

Time to Read

2 minutes

May 1, 2022

When expenses are high and you live paycheck to paycheck, any unexpected costs can make an already difficult personal finance situation way more challenging, especially if you haven’t been able to save money for an emergency fund. 

Here are steps you can take now to free up some funds and help you live within your means: 

  1. Create—or recommit to—a realistic budget. Take a look at your spending habits to see if you can cut back or eliminate any expenditures—maybe by switching to a new cell phone plan or a try shopping at a different grocery store. Your goal is to cover your critical monthly expenses, such as student loans and a car payment, but allow some amount of money for savings and fun each month without overspending. Follow your new spending plan closely for several months, then decide if you need to tweak any areas. 
  2. Pay yourself first. After priority living expenses are paid, it’s important to put money into a savings account, even if it’s a small amount. Having an emergency fund can help protect you from having to run up a big credit card balance the next time the unexpected happens, especially if it’s something more serious like a job loss. 
  3. Create a plan of attack against debt. If you’re like most people, you probably don’t remember what the interest rates are on your credit cards and loans. Check them out and set up a pay-down debt plan. Make at least your minimum payments but add more money toward the debt with the highest rate. When that’s paid off, add that payment amount to the debt with the next highest rate, and don’t add more loans or credit card debt. Pretty soon, you’ll have enough money in your cash flow, and you’ll be on your way to living within your means, making ends meet and reaching your financial goals.

We Can Help You Stay in Control

Do you want more help in making wise money moves toward financial freedom? Navy Federal Credit Union has financial advice and products to guide you. We offer ways to help you consolidate debt, build your savings and help give you better control over your financial situation. 

Next Steps Next Steps

  1. Get a handle on where your money goes with Navy Federal’s Monthly Spending Calculator.
  2. You can also set a target for your emergency fund with the Emergency Savings Calculator.
  3. For advice on goal-setting, budgeting and more, see Navy Federal’s Personal Finance Counseling.


This content is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.