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How to save on a low income
We’ve all been there, staring at your bank balance each month watching your money leave your account as quickly as it comes in. Nearly 80% of the British workforce struggle to make ends meet between pay days.
For many of you, going over budget often means you run the risk of missing payments that you really shouldn’t. Having to choose what bills you pay because you don’t have enough is enough to make anyone feel deflated and lost.
The thought of saving any money when your income is low feels impossible. Every penny is a prisoner so how can you build any kind of nest egg for emergencies or a rainy day?
It doesn’t have to be that way, saving money doesn’t have to be complicated and is only impossible if you make it that way. In the words of Albert Einstein – out of clutter, find simplicity.
We’ve compiled 7 tips to help you save money when you have no money.
Take the first step
It can be all too easy to avoid looking at your financial situation, simply because it stresses you out. But taking some time to create a budget can be a great starting point to changing your spending habits and gaining some control over your money.
Don’t be fooled
It’s not always easy to know when you’re paying too much for something. Whether it’s your energy, internet or car insurance, there may be a cheaper alternative somewhere.
Give online comparisons a go to see if you can switch to a different provider. It could end up saving you a few quid each month. Just remember to check the small print, don’t get caught out by additional fees or charges.
A little goes a long way
Saving can often seem pointless to some people because they can’t save large amounts each month. However, even the small change adds up in the long run.
Saving small amounts, even if it’s just your coppers, is better than saving nothing at all. Don’t let putting money aside become a burden, save what you can and be proud that you are doing it.
Some banks also offer ‘Save the change’ schemes where you can round up your purchases to the nearest pound, the difference going into a designated account. So it’s always worth checking if this is available to you.
Remember change is good
Old habits die hard, and changing your spending habits can be on the difficult side – especially when it can mean giving some things up.
Saving can present you with some tough decisions but remember that this is something that will help you in the long run. For example, if you were to lose your job then you would have savings to fall back on.
Make a commitment
If you make a budget or a savings plan, it’s important to remember to stick to it. There are online systems or bank schemes that will allow you to monitor your spending easily.
Giving yourself an allowance is also a great way to make sure you don’t overspend. Try taking this out in cash each month/week so that once it’s gone, it’s gone, and you can’t eat into other funds.
Set yourself rules and targets
Create spending rules or goals and put them somewhere in your home where they can always be seen. This is where you can get creative, make a board and put it in your kitchen, office or even on your door.
Set sometime aside each month to look through your bank statements and take note of your regular spending. This can help you alter your budget and saving habits to suit your situation.
Put your money in the right place
Make sure to put your savings in a place that’s right for you. There are multiple types of savings accounts, each with different levels of access. Choose depending on whether you need easy access to your funds or if you are putting the amount aside each time.
Having an account specifically for your savings is a more secure way to save. Especially as most banks are covered by the Financial Services Compensation Scheme, a government fund set up to protect your money.
If you are struggling with debts and would like some free and confidential advice, give one of our expert advisors a call on 0808 2085 195.