Saving money on a low income can be quite challenging, but it is not impossible. When your income or income is low, you should take basic steps to save money, one of them is setting goals. By adopting proper financial habits and various savings plans, you can easily achieve your financial goals. Saving money is not a difficult task when you give priority to your goal. You can continue it continuously. Yes, for this some special strategies and important things have to be implemented. Let’s discuss about it today.
Stick to your budget
Set a budget on the first day of the month and stick to it. This will help you spend a limited amount on groceries, personal care, bills, etc. Take a look at your finances and know which bills need to be paid by the due date. Once you have covered all the essential expenses, set aside a certain portion of your income as savings. Gradually increase your savings to around 15% to 20% of your income.
Make a habit of saving
To save a certain amount every month from your meagre income, you must develop a saving habit. You need to consider both short-term and long-term financial goals to stick to the routine. This approach will let you set aside a certain portion of your money before you get a chance to spend it. Over time, this will become a healthy habit and help you achieve financial stability. You can opt for various savings schemes in banks or other financial institutions. You can start saving as little as Rs 100 every month by opting for savings schemes like monthly SIPs in mutual funds or recurring deposits.
Secure your family with a term plan
Investing your money in an insurance plan and keeping your family safe should be a priority. It is possible that due to an unfortunate event, you may face an untimely death, leaving your family in huge debt. In such a situation, a term insurance plan you have will protect your family from facing a financial crisis in your absence.
The premium of a term insurance plan is very affordable, which is ideal for low-income individuals. You should also opt for a health insurance policy that helps you financially in case of a medical emergency.
Reduce your expenses in case of home
There are many ways to reduce housing costs to save money with a low income. If you are renting a place alone, you can choose to get a roommate. This will reduce your rent by half and help save a lot of money. You can also downsize your rent or choose a place in a different area that is available at a cheaper price.
Budget for food
It is important to set a proper budget for food. Plan your everyday food needs before going out for grocery shopping. This way you can stick to your set budget. Make sure to compare food prices and buy from the provider offering the cheapest price, but don’t compromise on the quality of food too much.
Cut down on unnecessary expenses
Cut down on unnecessary expenses to develop the habit of spending wisely. Instead of buying something new all the time, rent, borrow or buy second-hand items. Nowadays, many apps and sale sites are offering items at low prices. Search them and choose the cheapest one that is of good quality. Also cancel your memberships and subscription plans that you no longer need. This includes gym memberships, streaming services, online memberships and more.
Pay off your debt first
Repaying debts should be given priority to achieve long-term financial plans. Pay off your debts as soon as possible. To do this, first you should have a clear idea about your outstanding amounts and then make a plan to repay them without affecting your basic monthly expenses.
Automate savings and bills
To save faster with low income, treat your savings like bills. By choosing the automatic payment option, you can choose how much to transfer, when and where. The main advantage of automating savings and bills is that you don’t have to think about transferring money and your spending is already known and limited. This option works best for individuals who have a habit of not paying bills and payments on time.
Save on transportation
Bike or walk wherever possible. If you have easy access to public transport, this will be a much cheaper way to travel. If you live near a colleague, you can also opt for carpooling to your place of work. In today’s time, many apps help you get affordable travel options and shared rides. If you have your own car or bike, you can list yourself on different apps, which will help you earn some extra money by traveling with other individuals going in the same direction.
