Saving money is important for your future, whether you’re looking to pay for a down payment on a home or save for your retirement, and sometimes you need to do it quickly – but the reality of saving money is a challenge. For low earners especially, saving money each month can seem daunting.
Savings can act as a financial buffer in case of emergency and save you from debt. When you know how to budget money on a low income, you’ll find that a simple spending plan can help you put a little aside each month in no time.
There are lots of ways to save money quickly, even if you don’t have the highest salary. Read on to discover useful tips on how to save money, no matter how much you earn.
Start a budget
Budgeting is an important aspect of managing your finances when you are saving money on a low income. Budgeting is when you allocate a specific amount of your money to different expenses, like your car, food, home, or entertainment.
It helps you to avoid overspending or wasting money. A budget will help you understand exactly how much you spend in between paychecks, so you can identify the things you could cut back on.
Use public transport
Owning a car can be a very expensive necessity. The initial purchase price, maintenance costs, and the rising price of fuel makes having a car one of the most costly monthly outgoings.
Many people need a car to get to work or travel further afield to carry out other responsibilities. But an easy way to save money on fuel and car maintenance is to walk, use public transport, or cycle wherever you can. These inexpensive methods of travel can dramatically reduce your monthly costs – not to mention being much better for the environment.
Reduce your accommodation costs
Moving house is expensive, but moving somewhere cheaper could help you save in the long run. If you are near the end of your tenancy, you may be able to recoup some monthly costs by moving into a smaller place. Or, if your home is now worth more than you bought it for, it may be beneficial to sell and move to a less expensive location – saving the extra money you accumulated from the sale.
Moving into a shared house or apartment can also reduce your cost of living quickly. If you’re able to share your home with others, it will cut the cost of your bills and utilities as well as your rent.
Shop for discount clothes
Buying clothes second-hand or from an op shop is a great way to save money on a low income – and create a unique look for less. Rather than spending more than you need to on new clothes, thrift stores offer like-new pieces that are on-trend and cheaper than high street shops. Goodwill stores sell good-quality clothing for low prices, so you can find great pieces while donating to an important cause.
Be careful with food spending
Food can be one of the highest hidden monthly expenditures, so looking at how much you spend on groceries each month can help you budget. Make a meal plan each week, so you only buy ingredients for meals you know you’re going to eat – saving food waste as well as money immediately.
Batch cooking is a great way to always have a meal prepared and ready to go – to avoid the temptation of spending on a takeaway for convenience. Try food shopping online, rather than browsing the aisles, to avoid picking up any unnecessary extras.
Sell some belongings
You may think your belongings aren’t worth much, but you never know what someone else might want or need. Selling unwanted clothes, homeware, and even tools, on eBay and other resale platforms is a great way to make extra money.
It can also help put some perspective on your spending when you see how many things you own that you don’t need. And like they say, one man’s trash is another man’s treasure – so take a chance and see what you can sell.
Cut your entertainment costs
It can be easy to get caught up in subscription fees – especially for services that start as a free trial, and you forget to cancel. Pay attention to the entertainment platforms you use, and consider whether they’re worth the monthly fee. Chances are you don’t need all of Netflix, Amazon Prime, Spotify, and Disney+. You can also save money by renting movies for your movie night, rather than spending upward of $10 per month for the subscription service, and there are many podcast and music platforms that are free to listen to.
Take care of your health
Hospital bills and prescription costs are expensive, so taking care of your health is an easy way to save money in the future. Eating well, exercising, and taking care of your wellbeing can help prevent large sums going to doctors and hospital visits.
The healthier you are, the less likely you are to end up slammed with a large medical bill. And it doesn’t need to cost any extra: running, walking, and cycling are all free if you would rather save money on a gym membership.