Saving money when your income is in the six-digit range is fairly easier than for those with a low income. According to the U.S Census Bureau, the median income for U.S inhabitants in 2015 was $55,775. This means that anyone earning less than the median amount finds it incredibly difficult to commit to a savings plan.
Savings are essential to everyone, regardless of your income. It helps in building wealth and planning for the future. Here are a few and effective saving tips for people living on a low income:
Housing costs are usually the most expensive cost incurrences in any home. Between monthly rent payments or mortgages and utility costs, maintenance and repairs, household expenses are the first to drain your bank account.
Ensure you keep house costs to the lowest possible minimum by allocating it at least 35% of your paycheck. Either find a cheaper apartment or talk to your landlord about trading work on the property for a rent reduction if that is what it means to set aside only 35%of your monthly income.
- Stay away from debts!
Credit cards impoverish you! Studies show that using credit cards make you spend 12% more on average due to its simple and frictionless means of use. Therefore, avoid credit cards at all costs if you are trying to save on your low income.
Similarly, incurring debts means you have more monthly liabilities to pay off when your monthly check comes in. Your financial freedom is further delayed due to their interest accumulation. Begin paying off any existing debts as soon as possible and avoid obtaining more debts. It is advisable to begin tackling your high-interest debt first.
- Opt for walking
Other than the health benefits, walking also helps in keeping money in your pocket. If you can avoid using your car to go to work or to the store or to the gym, then do it. Saving gas money is another effective way of saving money when living on a low income. Likewise, you may opt to ride your bike or scooter (if you have one). It is also a great way to keep your body lean and fit.
- Use coupons, vouchers, discount codes, and cashback
Online shopping is advantageous due to the numerous possibilities of finding discount codes on the internet. You end up saving money and getting value for the money you spend. Anytime you want to go for shopping, look for any existing vouchers, coupons or discount codes, before you make any purchases. It also helps if you sign up for a company’s newsletter for notifications when they offer discounts.
Cashback is another great way to save money. There are numerous companies in the U.S which offer great deals when you sign up for their services. For instance, if you use the train often, the train company may have a regular cashback on all bookings. Remember to put aside the money you save by being a thrifty shopper. You might also want to use price comparison sites like Only Reviews to ensure that you’re getting the best deal on products that you might be interested in buying with your coupons.
- Diversify your income
A great way to diversify your low income is to start up a side hustle to help you earn some extra money. There are numerous side hustle opportunities,such as designing, which can be done from the comfort of your own home in your free time. Here is a business that designs custom trade show displays: https://www.expomarketing.com/. Simply consider what your hobbies are or what do you enjoy doing that can be transformed into a side job.
Saving money on a low income is just as possible as saving money while earning a six figure salary. All you need to do is to understand your priorities, set up a value-based spending plan and determine a saving plan. Once you do, you will be able to save more by being a smarter and savvier spender.