Saving is difficult for most people, but when you are working with a low monthly income, it can feel like no amount of rearranging your budget will leave you with enough worth saving. However, even when you don’t make a lot of money, it is important to start preparing for the future. Reducing your spending will not only help you save money, but it is also important so you can avoid debt or even worse bankruptcy. If you are looking for ways to stretch your income and start saving, here are some helpful tips so you can start working towards your financial goals.
Build an Appropriate Budget
If you are working with a low income, budgeting might seem like a difficult option, but it is vital to helping you build your savings for the future. Spending money when you don’t have a ton of disposable income is stressful, but planning it all out in a budget each month can relieve some of this stress.
To create your budget, you need to first determine all of the expenses you have that are absolutely necessary. These are payments you cannot miss under any circumstances, such as housing, insurance, utilities, and other bills. After you have figured this out, you are left with your disposable income, which can be split into savings and spending categories. Make sure to do your spending budget for things like groceries and gas first.
After that determine how much you want to save, and if you have any debt this is also a good time to decide how much of that you want to pay off each month. The final amount in your budget is what you want to spend on luxuries and other extra purchases. If you reach this point and have way too much in your spending category, consider adding more to your savings or debt repayment.
Reduce Your Housing Cost
One major way that you can cut back on how much you spend each month is to lower your housing cost. A study done by the U.S. Bureau of Labor statistics, housing is one of the largest expenses in any household. If you can reduce the cost of your housing, you can probably save a significant amount of money.
Start by taking a look at your space to see if you could downsize at all. You might be surprised by how little space you would actually need if you got rid of some unnecessary belongings. If you can’t really afford to go any smaller, see what other areas near you are like. For example, if you live and work in the city, you might be able to save a ton of money just by moving to the suburbs.
Pay Off Debt
When you are constantly fighting an uphill battle against debt, there is no room for you to save a sufficient amount. One of your priorities should be paying off your debt before you make any large purchases. These monthly payments are putting stress on your budget, and it could be leaving you with nothing saved each month.
If you want to save money, but have loans from school or credit card debt, make sure you are paying this off as soon as possible. The longer that you sit on your debt, the worse it is going to become and the further away from your financial goals you will be.
Reduce Food Spending
If you start tracking your spending, you might be surprised by just how much you spend on groceries and food each month. This is often one of people’s largest expenses, but it is also one of the best ways to cut back. Take a look at all of your food spending to identify where most of it is going.
For example, if you eat out a lot for lunch at work, this can add up to a tremendous amount. Instead of spending all of this money on food from restaurants, try packing your lunch. It can be hard to find the time, which is why so many people choose to eat out in the first place. Meal prepping one day of the week so that you have everything ready to go each morning can save you valuable time and money.
Another consideration to make is how much you are spending at the grocery store, specifically on certain ingredients. If you are buying all of your products premade from Trader Joe’s, you are spending way more money for a lot less food than you could have made yourself. Instead of buying pre-made meals, try to focus on cooking more. You can also try to cut back on meat, which tends to be way more expensive than other forms of protein. Even if it is just once a week, try making a meal that doesn’t have any meat or fish in it.
About the Author
Roni Davis is a writer, blogger, and legal assistant operating out of the greater Philadelphia area
EDITOR'S PICKS
After You Hire An Executive Coach, What Do You Do?
7 Simple Steps to Make You More Likeable
5 Ways to Improve Your Customer Payment Experience
Idea About Boosting the Potential to “Go Viral”
5 Effective Tips For Cloud Security
Keep Your Business Protected By Taking These Measures
How to Protect Your Business Reputation
How To Develop An Optimal Staffing Plan – A Must Know Before Hiring
Essential Promotional Strategies For Online Businesses
Invoice Factoring: A Guide for Young Businesses to Access Working Capital
Road to Recovery – 5 Tips to Get You On the Road to Financial Health
Top Three Ways to Develop a Growth Mindset
