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Trying to budget on a low income can feel like an uphill battle, especially if you live alone. But budgeting and successfully saving money is still a realistic goal.
There was a time in my life when I was lucky enough to say that my husband and I both had a combined income higher than average. It was wonderful not having to constantly worry about money. Better still, it allowed us to save for and purchase our first home. But shortly after moving, I became very ill and sadly had to leave my ‘dream job’. It was then that we had to sit down and sort our finances from a dual-earning household to a single one.
The following advice is things we still carry forward today, even with us both earning. For health reasons I only work sixteen hours a week, with the rest of my time going into writing and illustrating. As any freelancer will tell you, some months it’s enough to cover the mortgage. Others, you’re scraping together the pennies. But budgeting successfully is still manageable even on a low income or on an unpredictable wage.
For more information on sticking to your budget, read more here.
8 Tips to help you budget on a lower income.
Remember that every month is different.
That means that although you may be earning the same each month, new challenges can arise. The car could need new tires or a tap could need fixing. Rainy Days are always just around the corner, and that means unexpected expenses.
It’s a good idea to start putting money aside before issues arise. It can be as little as twenty pounds a week or month, so long as you tuck it away into a safety pot. If you find it difficult to afford to put the same away each month, you can adjust it slightly. Or you can put in more one month than the next.
Put it into writing.
Sit down and figure out where your money goes. That is your bare essentials, your luxuries, and everything in between. And be honest! There’s no point lying to yourself about the amount you spend if you want to be successful at budgeting.
There are plenty of templates to follow online if you thrive on keeping things neat and organized. Otherwise, grab yourself a book, draw out some margins and start with your monthly rent.
Monitor your cash flow.
This is similar to the above but slightly different. You need to take the time to monitor where your money goes in more than just the monthly direct debits. Keep an eye on your day-to-day spending too. Keep hold of recipients, even the small ones such as a coffee or a packet of gum.
Keep a folder, an old purse, or even a ziplock of all your old receipts. If you use any apps for shopping, remember to check back in your order history. There will always be places you forget to look for expenses, so don’t beat yourself up if you’re not always accurate.
Budgeting for the whole family? Check out this post for some simple, family budget planning advice.
Set realistic goals.
Don’t fool yourself. You’re not going to be able to save fifty percent of your income if sixty already goes on housing costs. Save what you can, but don’t leave yourself short for essentials. Sit down and create some SMART goals. That is that they are specific, measurable, achievable, realistic, and time-sensitive.
Build a plan that works for you.
As is the theme with this entire post, your budget is specific to you. You can read all the budget blogs that you want, but not everything is going to apply. Instead, take bits from all of them, and combine them to suit your needs. Maybe you’re not saving for a home and instead, you’re after your first car? Great! Tailor your plan to suit. Don’t have monthly travel expenses, but pay for a better internet to work from home? Let’s work around it and make a suitable plan.
Do you work from home? Maybe you’re planning on starting a side hustle? Great! Check out this post!
Be more mindful about what/where you spend.
Do you really need that coffee from Starbucks in the morning? Wouldn’t it be better to get a travel mug and make your own at home? Every little bit adds up, so be smart.
Find free or affordable forms of entertainment.
Netflix and Disney + are amazing, I can’t lie. I have them both and often beat myself up about it. But before this there was Youtube, borrowing DVD’s from friends and even,
dare I suggest it, streaming. You can also cut costs by going ‘halfers’ with friends or family on a streaming service of your choice.
But don’t forget about entertainment outside screen time. There are plenty of other things you can do for fun that don’t cost a dime! Go for a walk and play Pokemon Go, take on a cost-effective hobby, or have a virtual coffee date with a mate.
Here are some interesting ways you can save money during the summer holidays!
Don’t just go with the first deal you come across. Always compare big purchases such as insurance deals and buying new technology. You don’t always have to go with the cheapest option if it doesn’t tick all the boxes. But there are some cheaper deals available with the same benefits as those from more expensive, well-known companies.