Tips to Save Money on a Low Income

If your income is slow or even very low, you may be finding it difficult to save any money at all.

Here are some tips for helping those living on a lower income to increase their savings rate.

Keep housing costs Low

Housing costs are usually the biggest expense a person or family bears. Housing costs can drain your budget quickly. By keeping housing costs low and not buying or renting more than you need, you’ll have more money available for saving. A general rule is to keep total housing expenses below 25% of your monthly income. Here are some more in-depth ideas for saving money on housing.

Housing on Rent

• Find cheaper housing if you can find
• Talk with your landlord about wear and tear on the property for which you have expensed so he should reduce the rent
• Try to have shared house on rent

Homeowners

• Keep an eagle’s eye on utility costs and cut down wherever possible. Keep lights off, don’t waste water, keep the thermostat down in the winter and up in the summer
• Rent out a room in your house or space in your garage to help cut down on the house payment cost
• Maintain the house and keep it in good condition to avoid costly repairs, but avoid upgrades that aren’t necessary

Stay out of debt

If you are to pay debts means that you are to pay a part of your income into interest. To pay the extra amount for interest means you have less financial freedom. Using Credit Card is the same as you are taking a loan. The average interest rate of credit cards is about 19%.

By avoiding debt or working to pay off the debt you have quickly, you can put this money into savings instead.

Keep entertainment costs at the bottom

Eating out, hitting the restaurant after work, going to the movie theater and other entertainment purchases can add up to a big dent in your budget pretty quickly. Here are some ways to help keep entertainment costs low yet still have fun.

• Have family dinners at home instead of gathering at restaurants
• Have movie nights at home, complete with popcorn and soda
• Take advantage of free forms of entertainment such as hiking, biking and free city activities such as concerts and movies

Buy only when necessary

Many times budgets take a hard hit and savings to suffer due to unnecessary expenditures: avoid upgrades of home entertainment appliances.

Temptation to buy unnecessarily can also come in the form of peer pressure from those around you who spend with reckless abandon or from kids who want things that “everyone else” has.

Make a commitment with yourself that you’ll buy only when necessary until your savings account is built up to a satisfactorily level. And when you do need to buy, work to buy used if possible or to at least buy on price cut sale.

Samrt Saving with Freedom

By having a specified dollar amount come out of your paycheck and into a retirement or non-retirement savings account before you even see it, you’ll simply adjust to living on less and start saving money with little to no effort on your part.

Saving money — even on a low income — is possible. With a little ingenuity and a willingness to sacrifice purchases that hold no value to you, you can begin to save more money each and every week.