Dave Ramsey: 16 Tips To Live Well on a Low Salary
Written by
J. Arky
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Amber Barkley
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When it comes to financial advice, you want to make sure you are listening to an expert. Dave Ramsey has been in the financial game for a while now, so he knows a thing or two about budgeting and helping people who get by on low salaries.
Just to clarify: The term “low salary” in this case means $14,580 a year for one person or $30,000 for a family of four, according to a widely used federal guideline. That might not sound like a lot of flexibility in terms of discretionary spending money, but this is where Ramsey can help.
Here are 16 tips on how to live well on a low salary.
Use an App To Budget for Gas
This could be an app like Gasbuddy that helps you find the cheapest gas stations in your area so you aren’t overpaying the next time you fill up.
Join a Gas Rewards Program
While you are at the pump, sign up for a rewards program so you can get deals and discounts every time you bring your car in. You might not notice the savings at first, but in the long term you’ll notice an average savings of $1 per every gallon you put into your car.
Automate Your Savings
There are many ways to work with your employer and your bank to ensure that on payday a predetermined amount of your paycheck goes into savings. That’s money you don’t spend. It’s a “set it and forget it” system that builds up wealth without you having to think about it.
Cancel Automatic Subscriptions
Remove any automated subscriptions from your life — all they do is eat up money on services you likely do not use often or at all.
Make a Budget
Sounds simple, but not everyone writes out a budget and sticks to it. Try it for a week. Then a month. Then a whole year. You’ll notice that staying within the boundaries and guidelines you have set for yourself helps you not only to save but to stop overspending. In Ramsey’s words, “It feels like you got a raise.”
Compare Insurance Rates
It is best to shop around and see what works the most for you and your lifestyle. Not all insurance is created equal, so why pay more for a plan that does not fit you?
Replace Air Filters
If you own a home, you know one of the biggest expenses is furnace replacement. One way to dodge this cost is by being diligent about replacing your air filters. It’s a cost-effective solution — an estimated $20 to $50 annually — for maintaining your home’s temperature.
Buy Cheaper Groceries
Don’t get fooled into thinking Whole Foods is the only place to get the best groceries. You might end up paying more for your weekly stock-up of food and supplies, when you could get them much cheaper at a grocery store like Aldi.
Purchase Generic Brands
Why pay more for a name brand item when you get the same quality and more bang for your buck with a generic brand? Big chain stores, like Walmart and Target, have excellent generic brand products that will have you shopping with frugality in mind.
Focus on ‘Your Four Walls’
What are your four walls? In Ramsey’s view, it’s your basic needs. Take care of those expenses first. Everything else, such as debt, can be paid for later.
Meal Plan
Similar to budgeting, there is strength in charting out what you are going to eat, how much it is going to cost you and ways you can maybe stretch leftovers versus going out for a meal that’s more than you usually spend on food.
Skip Restaurants
Part of your meal plan and budgeting can involve one easy step: Do not go to restaurants. Cook at home, have potlucks with friends and neighbors, and save money on going out to eat.
Sell Stuff You Do Not Use
Junk. Everyone has it. Nobody needs it. What’s lying around your home that you can get rid of and make a little extra money off at the same time? Don’t worry if you don’t have a garage or a yard to make a sale event on, as platforms such as Craigslist and OfferUp connect sellers and buyers instantly.
Buy Used Clothes
There’s no need to spend extra money on new clothes when there is a surplus of used clothes you can get for cheap, if you are okay with that. The key is to ask about the functionality of the items you are wearing, then shop at used clothing outlets to match that need.
Plan a Staycation
Everyone loves a vacation, though not everyone can afford one. Solution? Try a staycation instead. While travel, housing and meals might not be in the cards for everybody’s budget, no one should be denied taking a break. Just do it from home and explore the cool things in your area during your next time off.
Ask About Discounts
This can seem intimidating at first. If there is no discount listed on what you are buying, surely it doesn’t exist, right? That’s not necessarily true. Lots of stores have fantastic deals they do not always publicize to the general population of buyers. If you never ask, you’ll never get the discount that is available to you. So be brave and ask an employee about a discount the next time you buy something.
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