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Saving money on a tight budget is not impossible. You’ll need to get creative and utilize the resources made available to you, but it can be done. Check out these 10 simple ways to save money on a tight budget.
According to Mint, 65% of people don’t know how much money they spent the previous month. Budgeting is important because it helps you plan and track your spending. Regardless of what your income is, you can stretch it by developing a specific plan for your money. If you don’t tell your money where to go, it will easily fly out of your control. Write out all sources of income and all your expenses for fixed and variable expenses. Adjust your budget so that more money is not going out than coming in.
What do you do when you first get paid? While most people may opt to pay bills or buy something else, you should pay yourself first. Take a percentage of your income off the top and save it first. Then budget with what’s left for the rest of the month. Paying yourself first allows you to prioritize saving for the short-term and for your future goals. You can even set up an automatic bank transfer to get you started.
Imagine thinking you don’t have money to save, but you start tracking your expenses. You find that you can cut your $500 grocery spending can be cut down to only $350 per month. Instantly, it frees up an extra $150 per month that can be saved while on a tight budget. This is why it’s so important to track your spending. You can track your spending manually or online and be sure to check your bank account daily. Many online banking apps allow you to view your current spending to help narrow down your budgeting buckets.
For anyone wondering how to save more on a tight budget, starting by lowering your grocery budget is key. Start by making a detailed list before shopping. Challenge yourself by avoiding ready-made items and rather focus on fresh foods and ingredients that are on sale
Lowering your cell phone bill is among one of the easiest ways to save money on a tight budget. While most of us prefer to have a cell phone, you don’t have to spend a ton of money on the monthly bill. There are tons of quality prepaid phone companies with plans starting at $10 to $20 per month. Some of these top companies include Republic Wireless, Tello Mobile, and Total Wireless. These companies use the same cell towers as major providers like Sprint and Verizon Wireless, so you’d be getting a similar service for much less money.
While credit cards are not bad, they’re probably not helping your situation if you’re trying to find out how to live on a tight budget. One of the best ways to save money on a tight budget is to only spend what you can afford to pay for with the money you have. This will not only help you stick to your budget, but also help with finance repair. Do not spend what you don’t have. It can help to remove all credit cards from your wallet for the time being to avoid the temptation to overspend.
Setting financial goals not only gives you something to aim for, but it also helps change your mindset. When you set a goal, you’re telling yourself to determine how you will reach it. This means that setting a goal to save $300 every month will motivate you to adjust your budget, earn extra money, and develop better financial habits to help you make progress even when money is tight.
If you’re competitive, consider taking a savings challenge this year and promise yourself a small reward for completing the challenge. One of the most popular savings challenges is the 52-Week Savings Challenge. Another is the $5 challenge which requires you to save every $5 bill you have each month. No matter what challenge you use, you’ll be growing your savings throughout the year.
Wondering how to live on a tight budget and save money? The 50/30/20 budget could be the perfect solution. Here’s how it works:
This method of budgeting provides a built-in opportunity for you to save and live below your means. If you’re spending more than 50% of your income on necessities, you can always adjust the percentages and adjust your budget to fit your current lifestyle.
Even if money is tight right now, you may still have some leaks in your spending. Maybe you’re still buying lunch at work or picking up extra snacks at the gas station. Maybe you’re always falling for sales on Amazon. It’s important to compare your budget to your spending each month and plug the leaks so you can save more money and meet your goals.
These are some of the best ways to budget money and save. These may not be the most obvious solutions, but they do work. Challenge yourself by breaking old habits and in turn, you can stop living paycheck to paycheck. Know your budget well, including how much it takes to meet your monthly expenses and explore your options with earning extra money. Consider implementing some of these simple savings strategies to loosen an already tight budget.