If you are trying to save money when you’re on a low income, it can be a challenge to know where to start. You may need to budget money for unexpected expenses, but you may not have extra money to put towards savings.
However, there are some practical ways that you can do to save money.
Table of Contents
- 1. Save As Much As You Can
- 2. Know How Much Money You Make Each Month
- 3. Calculate Your Monthly Expenses
- 4. Make a Budget
- 5. Automate Your Savings Goals
- 6. Look for Ways to Make Extra Money
- 7. Increase Your Income from Your Main Job
- 8. Make Adjustments to Your Lifestyle
- 9. Cut Out Unnecessary Expenses
- 10. Cut Entertainment Expenses
- 11. Look for Free Activities
- 12. DIY What You Can
- 13. Switch Banks
- 14. Ask for Discounts
- 15. Use Cash
- 16. Shop Around for Insurance
- 17. Lower Car Expenses by Using Public Transportation
- 18. Buy Used Items
- 19. Look for Deals and Discounts
- 20. Cut Back on Luxuries
- 21. Lower Housing Expenses
- 22. Ask for Help
- 23. Prioritize Your Health
- Final Thought
1. Save As Much As You Can
One of the best things that you can do is to try to save as much money as possible. Even if it’s just a little bit each week, putting money into savings can help you in the long run. You never know when you may need to use those savings, so it’s always good to have some cushion in case of an emergency.
2. Know How Much Money You Make Each Month
It can be difficult to save money if you don’t know how much money you have coming in each month. Make sure that you keep track of your income, so that you can budget accordingly. This will help you to make sure that you are not spending more than you are bringing in, which can put a strain on your finances.
Figure out all sources of your income, for example, if you have a job, but also receive money from welfare, child support, or alimony. Add up all of these sources of income to get your monthly total.
3. Calculate Your Monthly Expenses
You also need to know how much money you are spending each month. Keep track of your expenses for at least one month, so that you can get an accurate idea of where your money is going.
This will help you to see where you may be able to cut back in order to save more. For example, include your fixed monthly expense such as rent or mortgage, car payment, insurance, and electricity/water utilities in your calculation. Then, add in variable expenses like food, gas, entertainment, etc.
4. Make a Budget
Once you know how much money you have coming in and going out each month, you can start to make a budget. A budget can help you to see where you may be able to cut back on your spending in order to save more money.
Make sure to include your savings goals in your budget, so that you can make sure you are putting enough money away each month.
5. Automate Your Savings Goals
One of the best ways to make sure that you are saving money is to automate your savings goals. This means setting up a direct deposit from your paycheck into your savings account, or setting up automatic transfers from your checking account into your savings account.
In this way, you don’t have to think about making the transfer each month, and the money will automatically be put into savings. This can help you to reach your savings goals faster and make it easier to save money.
6. Look for Ways to Make Extra Money
Any extra money that you can bring in can help you to save more and get ahead financially. If you’re really struggling to make ends meet, you may need to find ways to earn extra money.
You could get a part-time job, start a side hustle, work at the weekend, or look for ways to make money from home. There are many different options available, so take some time to explore what would work best for you.
7. Increase Your Income from Your Main Job
In the long term, the best method to save money is to try to increase your income. This may mean getting a better-paying job. If the job you’re doing is your passion and is in your strength area, you’re most likely being paid what you’re worth. If it’s not, then finding a new job may be your best bet.
8. Make Adjustments to Your Lifestyle
You need to make some adjustments to your lifestyle. This may mean downsizing your home, getting rid of your car, or cutting back on your spending. Making these types of changes can be difficult, but if you are serious about saving money, they may be necessary.
9. Cut Out Unnecessary Expenses
If there are things that you can live without, then get rid of them. For example, if you have a gym membership that you never use, cancel it.
If you are eating out all the time, try cooking at home more often. Little changes like this can really add up over time and help you to save money.
Track your spending for a month and then figure out where you can cut back. You may be surprised at how much money you can save by making small changes to your spending habits.
10. Cut Entertainment Expenses
If you are trying to save money, you may need to cut back on your entertainment expenses. This doesn’t mean that you have to give up all forms of entertainment, but you may need to find cheaper ways to enjoy yourself.
For example, instead of going out to eat, you could cook at home. Or, instead of going to the movies, you could rent a movie from the library.
11. Look for Free Activities
There are many ways to have fun without spending a lot of money. Instead of going out to eat or to the movies, look for free activities that you can enjoy. Take a walk in the park, visit a museum, or attend a community event. There are often many things to do that won’t cost you anything.
12. DIY What You Can
One of the best ways to save money is to do things yourself. If you can fix something around the house, there’s no need to hire someone else to do it. You can also save money by making your own gifts or by doing your own home improvement projects. When you do things yourself, you can often save a lot of money.
13. Switch Banks
Banking fees can add up, so it may be worth your while to switch banks. There are many banks that offer free checking and savings accounts with no monthly fees.
If you are being charged fees at your current bank, switching to a new one could help you save money each month. Also, some banks may have a high interest rate on savings accounts, which can help you earn more money on your savings.
14. Ask for Discounts
You may be able to save money by asking for discounts. When you are shopping, look for sales and ask if the store offers any discounts. Additionally, many businesses offer discounts to seniors, students, and military personnel. If you belong to any of these groups, be sure to ask about discounts before you make a purchase.
15. Use Cash
When you use cash, you are less likely to overspend. When you use a credit or debit card, it can be easy to spend more money than you have. However, when you use cash, you are more likely to stick to your budget. When you pay with cash, you can also avoid paying interest and fees that come with using credit cards.
16. Shop Around for Insurance
Insurance rates can vary greatly, so it’s important to shop around for the best rate. You may be able to save money on your car insurance, home insurance, or health insurance by switching to a different company. It’s also a good idea to review your coverage every few years to make sure that you are still getting the best rate.
17. Lower Car Expenses by Using Public Transportation
Another way to save money is to use public transportation instead of driving everywhere. This can be a great option if you live in a city or have access to reliable public transportation. Not only will it save you money on gas, but it can also help you avoid costly parking fees.
18. Buy Used Items
If you need to buy something, see if you can find it used instead of buying it new. You can often find good deals on gently used items, and this can help you save a lot of money. Check garage sales, thrift stores, and online classifieds to see what’s available.
19. Look for Deals and Discounts
Whenever you can, try to look for deals and discounts. This could mean anything from using coupons when you go grocery shopping to looking for sales when you’re buying clothes. You may not be able to find deals on everything, but every little bit helps.
20. Cut Back on Luxuries
If you’re trying to save money, you may need to cut back on some of the luxuries in your life. This could include things like going out to eat, getting your nails done, or buying new clothes all the time. Instead, focus on only buying what you need and cutting back on the extras.
21. Lower Housing Expenses
Housing is often one of the biggest expenses for people, so it’s important to try to lower those costs if possible. If you own your home, you may be able to refinance your mortgage or make some other changes to save money. If you rent, you could look for a cheaper apartment or even roommates to help split the cost.
22. Ask for Help
Don’t be afraid to ask for help if you are struggling to make ends meet. There are many resources available to those who are low-income. You may be able to get help with food, housing, and other basic needs. There are also many financial assistance programs available. If you need help, don’t be afraid to reach out and ask for it.
23. Prioritize Your Health
When you are healthy, you are less likely to need expensive medical care. Try to eat healthy foods and get regular exercise to keep your body in good shape. Additionally, staying healthy can help you avoid other costly problems, such as missing work due to illness.
Saving money on a low income can be a challenge, but it is possible. By following these tips, you can make ends meet and put some money into savings. With some discipline and perseverance, you can achieve your financial goals.