We all want to put some money aside, whether it’s for a rainy day, a new car or a holiday. However, saving money when you’re living from paycheck to paycheck can be daunting. Unexpected expenses come up, bills come due, emergencies happen and there goes our hope to save. So how do you save money on a low income?
How to save money on a low income
Here’s your guide of realistic ways to save money when you’re living from paycheck to paycheck.
1. Know why you’re saving
Know why you’re saving and have a clear goal that motivates you to save.
Saving money is not easy, spending it, is. There’s always going to be something you want to buy, whether it’s for yourself, your children or home. Know what you’re saving for and every time you’re tempted to buy an unnecessary item, imagine yourself months or years from now actually reaching your goal. Every time you resist your impulse to buy something, brings you closer to your target.
2. Track your money
If you want to save money on a low income, you need to know how much you’re able to put away if anything at all. Sit down and go through your bank statements. How much money do you have coming into your bank account each month? How much money is leaving it?
Write all the things that must you must pay for, such as rent, energy, water and internet bills. (Make sure you’re on the best tariffs, call you energy and water suppliers and ask. Find out if there is any cheaper deal for having internet at home, etc.) See how much money you’ve got left after everything’s paid for and where that money goes, which brings us to the point #3 of this list.
3. Decrease your everyday spending
Now, this might require some thought and action. But if you want to save on a low income, you’re gonna have to budget the money you’ve got left after paying all the bills.
Spend less on groceries where possible
Examine how much money you spend on groceries each month and see if you could spend less. Create a weekly budget for groceries and stick to it, this might require some meal planning. Knowing what you’re going to cook means you won’t be buying unnecessary food.
Buy cheaper items, for example, supermarket’s own branded products instead of the well-known names. Search for cheap recipes online, consider eating less meat. For more tips on how to save when grocery shopping visit this website.
Turn the thermostat down by one degree
If you’re saving on energy already and wear an extra cardigan at home, then perhaps there’s not much else you can do. But if you’re heating your house more than you should, turn your thermostat down by one degree and put on an extra layer.
Stop paying for parking if there’s a free one a small walk away
Yes, it might not look like a lot, but if you’re using paid parking often, it will add up. Taking a short walk will not only save your money but is good for your health.
4. Live below your means
Whatever money you’ve got left after paying the bills and buying groceries, is where you’re going to save, it can be challenging when on a low income of course. However, it’s possible if you learn how to ”live below your means”. Think about all the stuff you could go without. For example:
Cancel unnecessary subscriptions and memberships
Twinkl was my go-to tool when I started homeschooling, but I barely used it a year later. I was still paying £5.29 a month for it, and while it doesn’t sound like a lot, that’s £63 a year that could have gone towards my savings instead.
Have a look at all the memberships and subscriptions you pay for, even if you’re using their services think if there’s any alternative to it.
Make your own coffee at home
Because it just doesn’t make sense to spend £3-£4 for a cup of coffee when you’re trying to save money on a low income. Add another couple £s and you can buy yourself a big jar of ground coffee that will last you a month or two, depending on how often you drink coffee.
It doesn’t go just for the coffee though, there are so many little things we spend on each time we go out: overpriced snacks from a corner shop, ready made salads and sandwiches, kids toys from vending machines. While all of these things don’t look expensive, they really do add up.
Get fewer takeaways
It’s delicious, I get it. Also, you’re tired, you’ve been on your feet all day and you really can’t be asked to cook at this point. Getting a takeaway once in a while is fine, we all need a break. But if you’re getting takeaway food often, you’re splashing much more money on it than you’ve originally thought.
5. Pay yourself first
Once you’ve worked out how much you spend on bills and created a budget for groceries, you should have a clear picture of how much money there’s left and how much you’re able to save each month. Don’t waste that money. Put it into a separate debit card first thing you get it. In other words, ‘pay yourself first’, because if you don’t, you might feel tempted to spend it on that cup of coffee or a takeaway. Then you’ll be saving whatever is left over (if anything).
6. Don’t borrow to live
Avoid borrowing money because eventually it’s going to become something following you for months or even years to come. That’s not something you want when trying to save money on a low income.
Buying on a credit has become easy, you can get almost anything, a car, a phone, clothes or toys, but it doesn’t mean you should. Every single month you’re paying the money you’ve borrowed will slow down your process of saving. Never mind that, if you can’t repay what you’ve borrowed you can get into serious trouble and debt.
7. Increase your income
I know it’s easier said than done but if you’re still struggling to save money, the only thing that’s left to do is increasing your family’s income. If your husband is the sole earner, consider creating your own business from home or doing freelancing, it doesn’t have to be full time, but just something you work on in early mornings when kids are asleep. Search job sites for remote, part-time work, many of these jobs do not require any experience and provide full training.
Can you save money fast on a low income?
It depends. Only you know how much money there is coming in each month and how much you’re able to put aside after budgeting. Remember, be realistic when trying to save money on a low income and don’t get discouraged!