10 Ways To Save Money on a Low Income
Written by
Ellie Diamond
Edited by
Melanie Grafil
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When you struggle to earn enough money, saving can seem impossible. But don’t get discouraged — saving is for everyone, even those living paycheck-to-paycheck. There’s always a discretionary expense you can cut or something you can do to earn a bit more.
It’s never too late, even if you’re new to saving or have felt discouraged in the past. Use these 10 strategies to learn how to save money fast on a low income.
1. Set a Goal
Whether you need to save $1,000 fast for a significant expense or put funds aside for an emergency, picturing why you’re saving money will help you get it done. Write your goal somewhere you’ll see it. Then, every day, imagine what you’ll do when you achieve that goal.
2. Commit to a Budget
Creating and sticking to a budget is one of the best ways to save money. Make a list of your income sources and necessary expenses such as rent, food and utilities. Once you’ve accounted for your necessities, you can see how much you have left over.
3. Commit to a Savings Percentage
Start by determining how much you want to save each month. A good starting point is 10% of your monthly income.
If you can’t manage that and still keep a roof over your head and food on the table, you can reduce it, but don’t rush into things. Aim high and adjust if necessary.
4. Choose What You Cut
In a perfect world, you’d put all your leftover income into a savings account. If you have the discipline to do so, at least for a month or two, that’s great — you may even be able to save $1,000 in less than a month.
But saving shouldn’t mean denying yourself all of life’s pleasures. For example, if you love going out to dinner with friends after work, you can still work that into your budget. Just set a spending limit.
5. Pay Yourself First
Paying yourself first means putting money into your savings before you budget for other things. It’s about viewing your savings goals as an essential rather than a luxury — which they often are, especially when you’re living on a limited income.
Add your monthly savings to your list of necessary expenses, so you don’t let saving slide when temptation arises.
6. Set Up Automatic Savings Transfers
A recurring transfer sends a specific sum from one account to another at a set interval — monthly, quarterly, or yearly, for example. Monthly is ideal if you do your budgeting every month.
You can set an end date or have it continue until further notice. It’s a convenient way to make sure you save, even when life gets busy. Log into your bank’s online customer platform and schedule the transaction online. Before you click “approve,” make sure each transfer makes it into your budget so you don’t double-spend.
7. Earn a Bank Bonus
Many banks offer sign-up bonuses if you open an account. It’s a quick and easy way to earn up to $100 or more in minutes. Check several banks to find the best offer, especially considering terms and conditions such as:
- Minimum deposits
- Ongoing minimum balances
- Account fees
- Bonus distribution rules
If you don’t want to keep the account open long-term, check out how long you need to maintain it to earn the bonus.
8. Do a No-Spending Challenge
A no-spending challenge means not buying anything for a set period, such as a day or week. You can spend zero dollars and use up your pantry staples for meals or restrict yourself to necessities.
9. Get a Side Gig
If you’ve cut spending as much as possible and you still feel like you’re not progressing, consider getting a side job. It’s the easiest way to increase your income and put more into savings. Flexible options such as rideshare driving or dog walking let you work your side hustle into your existing schedule.
Keep In Mind
Saving is a marathon, not a sprint. If you have an ambitious goal like saving $10,000 in three months, you might need to earn more to keep the bills paid.
10. Cancel Subscriptions or Choose Cheaper Options
If you have multiple streaming accounts, list the provider and your monthly cost. Then, consider how much you use each one and whether you can replace it with something free or lower-cost. For example, multiple music streaming services, such as Pandora and ad-supported Spotify, play the same music with fewer “premium” features.
Start Your Savings Strategy Today
Now that you’ve learned how to save money on a low income, look over these 10 ideas and choose a few you can implement immediately. Then, work them into your daily financial life and decision-making. Once they’ve become a habit, you can add another one or two.
With this slow and steady approach, you can become the saver you’ve always wanted to be.
