6 important lessons I learned from being broke

There was a period in my life when I was barely making ends meet. I wasn't on the verge of bankruptcy, but I lived paycheck to paycheck in expensive Washington, D.C., on an entry-level reporter's salary, which wasn't much.

I remember having to eat lunch at home before meeting friends at a restaurant because I couldn't afford a meal out. Fortunately, I could at least always pay my bills.

Those years of living lean actually helped me make better money decisions and take control of my finances. I certainly live a more comfortable lifestyle now that I earn more. But the lessons I learned when I was struggling financially have helped me avoid getting in that situation again.

April is National Financial Literacy Month, so here are six things I learned while I was broke and how those lessons made me more financially savvy. Hopefully, you'll be encouraged by what I did right and avoid what I did wrong.

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1. Don't live beyond your means

When I was just starting out on my own, I didn't buy new clothes every month or dine out every week. But, looking back, I realize that I was living beyond my means in an apartment that was way too expensive for my small salary.

I was paying about $800 a month for a one-bedroom apartment in Washington, D.C. That might not seem like a lot now, considering the median rent in the nation's capital is currently nearly $3,000. But I was there almost 20 years ago, and that rent consumed almost half of my monthly paycheck.

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I didn't stop to think about how hard it would be to cover my rent and still have enough left over for other expenses on such a small paycheck. Living beyond your means is an easy trap to fall into when you don't have much money. You might end up in this situation if you turn to credit to buy what you really can't afford. If you continue to live this way, though, it doesn't matter how much money you have; you'll always be broke if you live beyond your means.

I've since vowed never to let housing consume such a large percentage of my budget. My husband and I now have a monthly mortgage payment that's less than 20 percent of our combined monthly take-home pay.

2. Know where your money is going

If you want to break the cycle of living paycheck to paycheck, you need to know where your money is going. When I was nearly broke, I tracked every penny because I had to. If I spent more than $50 at the grocery store, for example, I knew I was in trouble.

Because I've become smarter about managing my money, I don't have to monitor every penny every day anymore. Now, I have all my monthly bills and expenses that must be covered listed in a spreadsheet. My husband and I have two bank accounts: one for bills with more than enough cash to cover our expenses, and one for spending, to which the debit card is linked. Moreover, we frequently audit our expenses to see what can be cut.

3. Have a safety net

I know it's tough to set aside money for emergencies or cover the cost of insurance on your own when you hardly have enough to pay the bills. I learned the hard way why it pays to be prepared for the unexpected.

My first paying job was an internship that didn't offer benefits. Being young and healthy, I assumed that I could get by without health insurance. That was a mistake. I found out that I had two impacted wisdom teeth that had to be surgically removed. Even though I had the procedure done at an inexpensive clinic that was a training ground for dental students, I didn't have the money to pay the $500 bill, which was about one-third of my monthly paycheck. I had to get help from my parents.

Insurance might seem like an unnecessary expense, but trust me, it isn't. Medical emergencies can be a lot more costly than monthly insurance premiums. And an emergency fund might seem like something you can afford to build when you're not living paycheck to paycheck, but that's when you need it the most. So consider making small sacrifices in spending now to build your safety net so you don't have to make major sacrifices when emergencies happen.

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