How to Take Control of Your Finances (And Stop Living Paycheck to Paycheck)

Do you also feel like your paycheck slowly arrives and quickly disappears? You're not alone. That's exactly how I felt a few years ago.

If you care about your financial future and want more than just surviving from paycheck to paycheck, you're in the right place. In this article, we'll go through simple and effective steps to help you get your money under control and build financial stability.

We'll start with the absolute basics and end with a concrete example.

The Basic Principle

When I simplify it as much as possible, finances are just:

Money in - Money out

The ideal state is clear: More money needs to come in than goes out.

How do you achieve that? You have only two options:

increase income (better job, side gig),
reduce expenses (tracking spending, cheaper alternatives, cutting unnecessary costs).

For most people, reducing expenses is much easier at first than immediately increasing income. And that's exactly where we'll start.

Understand Your Budget

Great, you want to get your finances under control. How do you do it?

When you open the internet, you'll find plenty of influencers telling you:

"30% for this, 20% for that, 50% here..."

I prefer the opposite approach.

First, you need to understand reality — where your money actually goes. Only then does it make sense to set up any system.

Basic Steps:

Write down all your income (salary, side income).
Write down all your expenses (rent, food, entertainment...).
Divide expenses into two categories - necessities vs. entertainment.

Let's Go Step by Step

1) The Very First Step: Manually Listing Expenses

You can use:

paper,
Excel,
an expense tracking app.

It doesn't matter how, what matters is that you do it.

If you mostly pay by card, download your bank statement. If you use a lot of cash, write down every expense manually for at least one month.

I recommend printing your statement and going through it with a pen. Divide expenses into basic categories:

Essential rent, utilities, internet, phone, mortgage, groceries...
Entertainment restaurants, movies, Netflix, hobbies...

Why paper? Because when you see it in black and white and actively write notes, you realize where your money actually goes. And that's the first moment when most people have an "aha" moment.

2) Working with Your Budget

Now you have:

an overview of income,
an overview of expenses,
division into categories.

It's time to think long-term. Not just "how to survive this month," but where you want to get to.

3) Motivation and Goals

This is the most important part of the entire process.

Ask yourself:

Why do I want to get my finances under control?
Why did I start reading this article?

Getting your finances in order isn't easy. It means:

making unpopular decisions,
occasionally denying yourself something,
going against instant gratification.

Instead of restaurants, cook at home. Instead of new clothes, wait. Instead of vacation, take a break.

To stick with it long-term, your reason must be stronger than the urge to spend.

My Motivation

What does it mean for me?

When my boss asks me to do something that goes against my values, I can leave anytime.
Work becomes a choice, not a necessity.
I do what I enjoy — not what I must do to support my family.

This realization is much stronger for me than a nice car or designer clothes. That's why I can say "no" to unnecessary expenses fairly easily.

4) Setting Up Your Budget

Now divide your expenses into categories and ask yourself:

Will this spending style get me to my goal in a timeframe that works for me?

If yes → great, just monitor your direction.
If no → you need to cut somewhere.

Start with essential expenses. Check if:

you're paying too much for internet,
your housing is unnecessarily expensive,
you have services you don't actually use.

This determines your living baseline.

Living baseline = the amount you must spend monthly to survive.

Once you know this number, you can start playing with the rest:

how much goes to your goal,
how much you keep for life now.

The more you invest, the faster you reach your goal — but at the cost of a boring life, which I strongly don't recommend... The less you invest, the more comfortable the present — but the longer the journey.

Find a balance you can maintain long-term. Think 10+ years.

I Know What I Want. How Do I Do It Practically?

Great. Now you:

know your living baseline,
have a goal,
have a basic system.

The hardest part is behind you.

Example of simple paycheck division:

50% living baseline
25% goal
25% entertainment

Step 1 - Break It Down a Bit More

For better clarity, it's good to divide main categories into smaller parts.

This way:

you quickly notice when something's off,
you can react before it's too late.

For example: If you have 10% for restaurants and after a week you're at 8%, that's a clear signal. With one large "entertainment" category, you'd only find out at the end of the month.

Ideal category size: 2.5% – 15%. But remember — the most important thing is to control the main three parts:

living baseline,
goal,
entertainment.

Why Percentages?

Percentages have one huge advantage: When you earn more, you automatically improve your entertainment too — without guilt.

Step 2 - Create a Routine

Without routine, no system works long-term.

Recommended routine:

Pay yourself first As soon as your paycheck arrives, immediately send money to your goal.
10 minutes of review once a week Download your statement, upload it to a Financial Tracker and check your direction.

For example, every Sunday at 6 PM. This way, nothing surprises you at the end of the month and you tame the spending devil in time.

Once you learn this, 10 minutes once a month is enough. Just a check and possible minor adjustments. During the year, you might need to adjust some budget, and 10 minutes once a month isn't that terrible.

Example: John Smith Saving for a Down Payment

John Smith:

28 years old
net income: $5,000
goal: $100,000 for a house down payment

After listing his expenses, he found his living minimum is $2,500 (50% of income):

$1,500 – rent and utilities
$700 – groceries
$50 – internet
$100 – transportation
$150 – personal loan

That leaves $2,500 for his goal and entertainment.

If John saved all $2,500 monthly, he'd have $100,000 in about 3.5 years. But he also wants to live.

So he chooses a slower path — 7 years — and the following breakdown:

30% rent & utilities, $1,500
25% his personal goal, $1,250
14% groceries, $700
1% internet, $50
7% transportation + car (gas, insurance, ...), $350
3% personal loan, $150
10% Restaurants, $500
5% Entertainment, $250
5% Random things (Spotify, Netflix, Trips, ...), $250

A system that makes sense to him — and that's what matters most.

Conclusion

Getting your finances under control isn't hard or time-consuming. Once you have a system, 10 minutes a month is enough to stay on the right path.

It's not about perfection. It's about starting — and persisting.