If you’re living on a low-income budget, managing your money can be hard. Monitoring your spending, knowing how to reduce it and saving money can help you make ends meet. With a little planning, you can start to feel more comfortable paycheck to paycheck.
Creating a budget on a low income
Planning your budget when you have a low income involves tracking your spending, knowing how to better spend the money you do have and giving yourself saving goals. We’ve developed some budgeting advice to help you manage your spending better.
- Keep a spending diary. Stay in control of your spending by keeping a record of everything you buy. From car insurance payments to purchases at the corner store, logging every cent can help you spot places to save money.
- Use monthly totals. Instead of looking at one-off purchases, consider how much you spend on items like cigarettes, new clothes and eating out every month. You might be surprised at the total. Is it time to cut your spending on these? It might seem like a sacrifice at first, but you’ll feel much better when you realize how much money you’re saving.
- Shop smart. When grocery shopping, go once or twice a week and get everything you need. People often spend more when they drop by the store daily. Plan your meals for the week and buy only what’s on the menu. Even better, make meals in bulk and freeze leftovers for a quick meal another day. Don’t go grocery shopping when you’re hungry as we tend to spend more. And don’t forget to load your Shopper’s Card with digital coupons before you leave for the store.
- Have a reason to save. Having savings goals can help you save money more successfully. Whether you want to build a fund for emergencies or raise money for house repairs, saving targets can help you set and achieve weekly and monthly goals and build savings faster.
How to save money fast on a low income
To cut your spending quickly you need to look at your regular bills, ways to reduce daily spending and where you can get things for free. If you need to cut your spending and save money fast, these tips could help.
- Switch providers. Switching providers for energy or cellphones can save you hundreds of dollars a year on bills and quickly reduce your monthly payments. Get a quote from another provider in your area – they could be offering a better deal. Even if you don’t want to change, talk to your current provider to see if they can offer a better deal or switch to a less expensive plan. Make sure to have a recent bill so you know your current costs to get the package that suits you best.
- Have a ‘spend free’ day. If you’re struggling to think of where you can save money, a no-spend day could make all the difference. Dig into the freezer for food, walk instead of taking the bus, or play in your yard instead of taking the kids out. A day where you spend no money is a great way of finding out what you can live without or cut down on.
- Sell things you don’t need. Make some quick cash by selling any belongings you don’t need. There are plenty of places online to sell any old CDs, DVDs and games you no longer play – or any clothes you don’t need. If you buy a new TV, microwave or cellphone, don’t just throw the old one out – sell it to someone who wants it.
- Try free versions. You can enjoy your hobbies and interests if you’re living on a low-income budget – and take up new ones – by doing them in less expensive ways. For example, go running outside instead of paying a gym membership, drink a coffee at home rather than buying one on your way to work, and don’t pay for a movie ticket when you can watch a film at home.
- Take advantage of prepaid debit cards and card cashing. Carrying cash without a reason can make it even more tempting to buy unnecessary items. Load your cash onto a prepaid debit card and use it just like a bank debit card. It also helps keep your money more secure. Then if you need to get cash off the card at any time, you can do so at Money Services and get only the money you need – down to the penny. This can help you can stay in control of your spending and keep your budget in order.
By using these tried-and-tested methods, you can put yourself in a more healthy financial position on even the tightest budget. See which tips work for you.