Tired of living on Struggle Street? Here are eight tips for breaking the vicious cycle of living pay to pay

Almost half of all Aussies spend the entirety of their wage, according to a whitepaper produced by MLC.

You might think this is unique to those with low incomes, but surprisingly, one in four (27%) households earning $150,000-$199,000 also confessed to living pay to pay.

Even more shocking: one in five (22%) of those earning $200,000 or more are still living pay to pay.

It seems regardless of where you sit on the income spectrum, finances can be a struggle. So how can you stop living pay to pay? Below you'll find our top tips to help you finally break the cycle and set yourself up for a brighter financial future.

Know where your money goes

Whenever someone talks about getting their finances organised, the most common tips are "make a budget" and "track your spending", and for good reason. If you don’t have any idea where you’re currently spending your money, it’s impossible to be able to make cutbacks and changes.

Many banks now have features that categorise your spending and show you where you are spending most of your money.

Tracking your spending doesn’t have to be high-tech, and can even be as simple as writing everything down in your phone or notepad for a month.

Once you do this, you’ll be able to see where your biggest spending areas are. These are the ones you need to look at cutting back first.

Get comfortable saying "no"

Paying attention to your finances and trying to save money will mean that you’re going to have to learn to say "no" to things you may have otherwise done, such as a holiday or going to a concert. Cutting back on these unnecessary expenses is a temporary measure, though, and takes sacrifice and commitment.

Evaluate needs vs wants

Similar to learning to say "no" is learning to understand the difference between a "want" and a "need". The essential needs for us as humans are simple: a roof over our heads, clothing on our backs and food to keep us nourished. Everything else can usually be defined as a "want" (including ostentatious versions of our basic needs like a mansion or caviar).

To cut back on your spending, get clear on what things in your life are "wants" and can be cut out.

Reduce your debt

Alongside the increase in spending is the rise in our household debt levels. A staggering 70 percent of households reported some level of debt, with a quarter of these holding a debt that was three or more times their annual disposable income.

If you can reduce your debt, as well as try to not increase it, you’ll be in a better position financially. Cut up your credit card and commit to not spending money that you don’t have in cash.

Become more frugal

The rise of Airtasker, UberEATS and other convenience services mean that many of us are spending money that our parents or grandparents wouldn’t even dream of spending. The cost of outsourcing tasks to others can be quite expensive, and needs to be weighed up against the benefit of doing something yourself and saving that money.

Some frugal habits include doing your own cleaning, growing your own fruit and vegetables, sewing or mending your own clothes, doing your own beauty services and walking or biking instead of driving or hailing a ride-sharing service.

Get hustling

The flip side is that you can take advantage of the popularity of on-demand convenience services like Airtasker and Uber and make money from them rather than spend money on them. Instead of spending your free time on the couch having a Netflix binge, maybe you could take up a second job or even embark on a side business. The barrier to starting up a side gig has never been lower, and the extra income you get in can be set aside immediately into your savings.

“Working extra hours takes commitment, but remember: it’s only a temporary measure to help increase your income. You don’t have to do it forever.”

Working extra hours takes commitment, but remember: it’s only a temporary measure to help increase your income. You don’t have to do it forever.

Hide your savings

As the saying goes, "out of sight, out of mind". Automating a certain percentage of each pay to be deposited into a savings account that you cannot easily touch can help you begin to save. Store these savings in a separate account to your everyday account - and ideally in a different bank. If you can’t easily see the money, you’ll be less likely to spend it.

Find your "why"

Find your reason for saving money. Staying motivated can be hard, and with no set goal in mind, you may find yourself giving up. Setting a goal is just one way to keep yourself motivated. Aside from this, finding an accountability partner can also keep you on track. Whether this partner is a friend, an online community or a spouse, sharing your goals with another person makes you more likely to achieve them.

The journey to financial freedom is a long one that takes sacrifice, hard work and commitment. Incorporating these tips and tricks into your daily routine will help you begin to stop living pay to pay and set you up for a more stable financial future.

It may seem impossible, but with a little hard work, a future without money worries is entirely achievable.

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All information provided in the magazine is sourced from independent writers & may contain general advice that is not endorsed by the FairVine Super Plan.