With more families than ever living paycheck to paycheck, saving money for you and your family’s future can seem like an impossible task. Perhaps you dream of buying your own home, studying to further your career, or going on a holiday. Whatever your goals, it’s essential to take control over your finances to make them a reality. While saving may seem impossible as a low-income earner, you can put yourself on the right track by making smart decisions with your money. Here’s how:
Avoid High-Interest Lending Options
Managing a low-income wage can be challenging, especially when unexpected expenses arise. People get into financial strife when they feel they have no other option but to put an emergency cost on their credit card or turn to a pay-day loan. More often than not, this leads to high-interest payments which drive up the amount repayable far beyond the original sum. To help avoid this cycle of debt, no interest loans for small amounts of money are available online for when you’re in urgent need of cash.
Track Your Spending
Do you ever look at your bank account and wonder where your money has gone? You’re not alone: most people can’t account for their full paycheck. Try downloading a free app to track your spending. You might be surprised by how much you’re shelling out on paid parking or lunches while at work. Once you see the figures, it’ll be easier to prioritize and find costs to cut back. Maybe you can park the car further out and walk to the office, or ride your bike in. Some cities have free inner-city buses, so parking and catching a bus may also be an option.
Embrace Free Activities
If you research local community events online, you’ll be sure to find a wealth of free activities in your area. Many public libraries offer singing and story time for children, and while you’re there, you can stock up on books and movies without spending a cent. Get some fresh air and exercise at the same time by taking up walking with a friend. If you really love yoga, you can practice at home with free video tutorials, or even offer to clean your local yoga studio in exchange for a lesson each week.
Save Monthly for Bills
Some months seem to be particularly hard on the hip pocket, with multiple expenses rolling in at once. To avoid this strain on your pay packet, work out what your total annual spend on bills is. Remember to include car servicing, insurance, and driver’s license renewal fees as well as monthly statements like phone plans, water, gas, and electricity. Divide this cost by the number of times you’ll be paid in a year and start saving that much every month. This way, you’ll never be unprepared when a bill comes in.
Setting financial goals can be a great help when you’re working hard to save on a small budget. Your initial goal might be to get rid of debt, and then to start saving even a few dollars from each paycheck. Give yourself a high five for every step you make in the right direction – celebrating and acknowledging each small win can make the larger goal seem less overwhelming.
Saving money when you aren’t earning a lot is difficult. However, if you’re consistent and determined, you can establish good spending habits and slowly work your way towards a stronger financial position in the future.