Tips on how to save money.

Save money 

Do you feel like it's nearly impossible to save money based on your current income. While saving money is much easier, when you are making big bucks. So, here I have the best proven ways on how to save money.

 It is entirely possible to save money on a low-income, therefore in this article, I will share with you seven practical ways to save money on a low income.

How to save money.

1. Lower your housing costs whether you rent or you own.

Lower your housing cost.
The cost of your housing will be your largest expense every month many financial experts suggests that the total of your rent or mortgage payments plus bills should be no more than 35 percent of your monthly after-tax income and while this expense eats up a lot of your monthly income, it also offers the largest opportunity to find cost reductions. Essentially allowing you to save more money even if you're earning a lower income for renters.

There are numerous wastes you can reduce your housing costs with the first being to find a cheaper place. Perhaps a single room in someone's house will be adequate for your needs instead of continuing to rent a two-bedroom apartment, but if you have no desire to move then it may be time to look into other ways to reduce your current rent.

Effective strategies can include negotiating an exchange of your services like doing renovations for a rent reduction or agreeing to sign a longer lease if the tenant security is what your landlord wants. when I used to rent I exchanged tax advice and monthly book keeping services for a few extra hundred rupees off.

My rent this simple swap of goods and services saved me thousands of money over the course of my lease. Allow me to save money while earning a low income and if you are a home owner then the advice is a little bit different.

 Well you probably don't want to move out to save money even small things like turning off the lights and reducing your water usage can lead to substantial savings over time.

However the best way to offset your housing costs is to rent out a room. Rent a gun room in your home can easily net you a few extra thousands of rupees or dollars  a month which can help cover your bills allowing you to put more money in your piggy bank at month's end.

2. Avoid debt if you want to save money.

Avoid your debts to save money.
While making an income smaller than you'd like then you must avoid debt at all costs this is because debt deters you from saving in two ways. firstly, having that means monthly repayments every month creditors will be knocking at your door for money which if that debt was avoided would mean more money in your pocket at month's end.

Secondly, debt is almost always associated with monthly interest charges for lines of credit these rates are typically around 3% to 5% which means that on a 10,000$ balance you had to be handing over around 25$ to 40$ or around rs 2000 to rs 3000  a month or well this seems like a small amount of money.
Avoid debts.
when compounded monthly it can begin to add up when you total the dollar value of all of your repayments and their associated interest charges. You can start to see how caring debt can make saving on a low income a challenge.

 This issue is only further exacerbated when it comes to credit card debt as of 2019 credit cards calm reports that the average interest rate on credit cards is 17.6 % meaning that getting into debt is an expensive ordeal and if you are carrying the average credit card balance per US adult of  6,348 dollars which at that rate means you're paying about 1,120 dollars and 42 cents and interest charges to credit card companies.

Therefore, if you want to save money on a low income you need to avoid debt and their associated interest charges at all costs.

3. Limit entertainment costs.

Limit your entertainment cost .
We all want to have fun but unfortunately for many people this comes at a hefty cost. Eating out, hitting the bar after work, going to the movie theater and other  entertainment purchases can make a huge dent in your budget but luckily doesn't have to. Let's take an example of one of my friends , When I was younger his main source of fun was going out to the club with his friends but unfortunately most nights were very expensive between calving to and from the bar, buying drinks and paying cover.

 Most nights Rummy $100 easily as he got older his attention shifted towards growing his wealth and he didn't want to lose out on social time with his friends.

This made him brainstorm new ways to get in quality time with his friends while not breaking the bank. One of my favourite alternatives has been going on walks with my friends but some other ideas i have come up with include having dinner parties at home rather than at a restaurant and watching a movie on netflix rather than going to the theater.

In short we all need to have fun but we don't spend an arm and a leg to do it.

4. Understand your wants versus your needs.

Understand your wants and needs.
There is no doubt thats pending money makes us feel good but when you are earning a low income and have a desire to save, you need to be able to donate your wants from your needs.

for instance, you may want to buy a new phone to the newest model but you probably don't need to, you may want a new shirt to wear out this Friday but you probably already own plenty of good shirts. when you are not making a lot of money, you have to be extra diligent and spent only on your core expenses.

So how should you draw the line between want and need items. I like to classify anything that relates to my survival as a need, these are things like food clothes shelter and transportation. In their most basic form sure buying a Ferrari is transportation but in its most basic form taking the bus also gets you from point A to point B.

One items are basically anything that falls outside your needs group this includes anything that is an extension of things you already own. for example, if you were to upgrade your phone to the new model just to get a camera with an extra two megapixels in it now of course you can't restrict your spending to the bare minimum forever. So if you do want to splurge on a one item.

Here's what I suggest, set a financial goal you want to achieve like saving a thousand dollars or thousand rupees. Once you have hit the goal you can then go ahead and purchase the item you have been wanting.

This technique is great for two reasons first it helps you build the habit of forming financial goals and second it gives you time to process how badly you want the item.

As often, we purchase things out of impulse and find ourselves experiencing buyers are more soon after. So if you want to ensure you save money on a low income, you must be able to seperate your wants from your needs.

5. Spend wisely on groceries.

Spending wisely on groceries is the key tip on how to save money.
The average amount of money a family for spends on groceries is estimated at nearly Rs 20,000 or  $400 a month which makes it one of the higher monthly expenses we typically incur. However with a bit of planning and the strategies I am about to share with you it's not unreasonable to be able to cut that number in half.

The first step in cutting your monthly grocery bill is to plan your meals ahead of time. This will not only be a step in the right direction from a health perspective but it will also ensure that you only spend money when you absolutely need.

You see whether you realize it or not we waste a lot of food. A 2018 study in science daily found that every citizens globally waste on average up town to food a day which if avoided commune big savings in the grocery department.

Besides avoiding waste planning ahead will allow you to buy foods that are on sale meaning that your typical $250 a week grocery bill can easily shrink to $200 or less ultimately putting more money in your pocket at month's end.

The second step in reducing your grocery costs is to eat less meat. Meat is by far the most expensive grocery item you can buy it which makes it an easy target when trying to reduce your bill.

 Now I am not saying you need to become a vegetarian in order to save money but by cutting down your meat consumption or replacing it with cheaper options like beans you will be able to cut down your grocery bill drastically.

The final tip that will help you reduce your food bills is to only bring cash when going grocery shopping. All too often people find themselves at the grocery store hungry and eager to fill up their shopping carts which is facilitated by the seemingly endless ability to spend on credit.

Instead plan out your purchases ahead of time and only bring enough cash for those items you need, so you don't let your hunger get the best of you.

6. Practice zero-sum budgeting

Zero sum budgeting.
When practicing zero-sum budgeting you are intentionally spending every single penny  you make but not in the way it sounds. Zero-sum budgeting involves allocating your income towards each of your expense line items and in your marking any left over funds towards the  savings or investment account.

Let's use an example to illustrate this budgeting method say you were earning $2,000 a month after tax at your job using the zero-sum budgeting method you would allocate this entire $2,000 towards your monthly expense line items.

 Typical expenses include rent car payments, gas, groceries and entertainment but using this method you would also create a line item for savings. Once this listing is complete you would then allocate your entire $2,000 to the light items which forces you to put part of your income and savings.

The strategy is particularly effective for those who typically get to the end of the month and realize they have no money left for savings but with the zero-sum budgeting method as long as you stick to your initial budget, you will be sure to see your bank balance grow.

7. Automate your savings.

Try to automate your saving .
The final step in ensuring you save money even on a low income is to automate your savings one of the best things. I have ever done for my finances was setting up automated deductions from my pay with my employer in essence.

what these deductions allowed me to do was send part of my paycheck directly into a savings account instead of the full amount going right into my checking account.

when I initially set up this process I allocated 10% of my after-tax income to my savings account but overtime I found that I have been able to up this to about 20 percent and double my monthly savings. Now I think this savings technique has been so successful for two primary reasons.

First it allowed me to pin point exactly how much I wanted to save. In fact by using automated deductions, you can set your deduction to the amount you have designated as monthly savings in your zero sum budget, which helps you tie the two money saving techniques together.

Second, it took the thought of having to save off my mind allowing me to focus on other important things like improving my skills in order to make more money.

 I often preach that once you have a solid savings technique in effect that making more money is the number one way to save more. And by freeing up a mental bandwidth I was able to take on more freelance work earning the extra income and ultimately boosting my savings.

I hope you guys enjoyed this article, tips on how to save money with low income.  Please let me know in the comment box below. I hope you guys have been enjoying my blog so do subscribe for more articles like this.Thank you so much for reading.


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