Saving money has become the biggest concern for people who live paycheck to paycheck. With the rise in inflation, things aren’t the same as they were a decade ago. You might have to apply for a new loan when you have left no options to pay bills for regular emergency needs. With a maxed-out credit card, it is stressful to manage your daily expenses if the salary day is a week later. While there are options to make quick money whenever you need, the best and smart option is having a fund ready to use. Okay in simple language you need to save money to survive financially in the future.
Wondering how to save money if you are on a tight budget? Well, there are are plenty of options to save money and make money fast. In fact, you can even make a million dollars on an average salary. Okay, coming back to how to save money on a tight budget, here are 20 creative ways to do that. So, you won’t stop saving after a week or two or feel scared to start saving right away.
Create a Budget
First things first, you need to know how much you earn monthly and how much you spend in detail. Without tracking your incoming and outgoing cash flow, you can’t decide how much room you have to save. So, create a budget today. Wondering how to make a budget? Read our How to make a budget guide
Creating and forgetting never works here. You need to stick to your budget, there are no excuses. In fact, the fun part is right here. You will find yourself as a pro in finances over time if you can manage to stick to your budget rightly.
You can either choose to create it in a spreadsheet on your own or rely on apps that make a spreadsheet for you or get an advanced app that manages your budget. Mint, Clarity Money, YNAB, Goodbudget are a few apps that help you in planning and budgeting.
Follow 50 30 20 Rule
Well, while creating the budget make sure you follow the 50 30 20 rule. This simply means use 50% of your income for your needs and essentials. 30% for your wants (stuff like makeup) and 20% for your savings (maybe for your retirement and house down payment). This way you will have a fixed and practical budget.
Find Out How Much You Have to Save Each Month
Now you know how much you make every month, how much money you spend, and how much you have to save. Make up your mind to save that particular amount each month no matter what. Set up an automatic deposit into your savings account immediately every time you receive your paycheck. Having a definite goal of how much to save each month controls your spending habits.
Track Your Expenses Regularly
You have a budget and savings account now. In the beginning, you may have to track your spending closely, maybe daily or weekly or monthly. After you get used to it, you can track your expenses monthly once. Tracking lets you find where and why your budget is weak. So, that you can take extra care or make improvements to your budget plan.
Plan to Buy Something You Love a Month Ahead
It’s humane to tempt for stuff that looks lovely. Before, when you didn’t start the budget you might have swiped multiple times for items you fell in love then and there. But now, you have a budget and you have to stick to it. So, the best way to get hands on the products you love is to plan ahead and save money for them. Say, if you felt like you want to buy a gadget now, go home start saving for it and visit the store after a month. If you still feel buying it, buy it with the money you save.
Have Multiple Savings Accounts
It’s good to have different savings accounts for different goals. For example, set up a savings account for the house down payment and open new savings account if you want to buy a car and have a different one for buying a gadget. This way you won’t mix up your funds and end up having zero money for your long term goal.
Use Cash When You Leave for Grocery
When you have a credit card by your side, you feel like buying the entire store. This mostly happens when you visit a grocery store where you are inclined to buy the stuff that is not essential to have or unhealthy. So, to avoid such a situation, carry cash when you go for a grocery store or anywhere you feel you can’t control your spending.
Get a Piggy Bank
Get a cute piggy bank and start a habit of throwing coins or change into it. The savings may look small now but over time they may help you in the long run.
Set Your Financial Goals
It’s important to have both short term and long term financial goals. Goals help you to stick to your budget, save money consistently, develop good financial habits, and reach those goals even faster.
Enable Automatic Deductions
Most things are automated today which is good to a major extent. Try to use technology in your financial life as well. Set automatic deductions for your bills, insurance, and savings to weigh off your shoulders. This way you don’t even have to think of worrying about how much you spend on coffee and feel guilty.
Build Healthy Habits
Your lifestyle can cause money problems and vice versa. When you are physically and mentally healthy, you tend to live financially healthy. In the same way, when you are financially secured, your physical and mental health improves. This simply proves you have to take care of your health prior to taking care of your finances. So, build good physical and mental habits such as exercising, proper diet, meditation, yoga, etc.
Have a List Before you Go Shopping
If you don’t decide what to buy before you visit the shop, you will end up buying what you actually don’t need now or in the near future. Finally, that weighs your bill and burns a hole in your pocket. So, to avoid this make a list of what you need and the budget for it before you leave your home to shop.
Make Use of Cashback & Discounts
The best way to cut your expenses is to buy stuff when there are sales or discounts. Also, make use of cashback offers with your credit cards or payment apps.
Cut Off your Cable Connection
Well, with the evolution of Netflix, YouTube you don’t actually need a cable connection. So, consider cutting it off to save money. Also, save more money by reducing the usage of water, electricity, and energy so that you can save a lot of money in a year.
Limit your Subscriptions
You might have subscriptions that you are not using now. So, recheck your subscriptions and consider opting out. You can use a service called Trim to delete all subscriptions that are not essential for you.
Spending time with your family and friends is fun and healthy than binge-watching television. Don’t you agree?
Always Have a Side Hustle
In order to save more, you will have to earn more. So, try getting a second job. Discover your skills and decide what kind of side hustle is best for you. There are plenty of options like becoming a delivery driver, renting out your car, freelance writer, virtual assistant, or online tutor that pays you well. Choose a side hustle that interests and suits you to make more money. You can either save the money or invest to grow the money.
Have an Accountable Partner
You tend to stick to your budget and save more money when you have an accountable partner accompanying you in these activities. So, find a partner be it your spouse or colleague, or a friend to effectively save your money.
Choose the Right Insurance Plans
You are paying more unknowingly to your advisors and middlemen when paying for insurances. So, carefully choose the insurance plan that needs a low fee so that you save more money in the long run.
Negotiate Interests Rate If You Have Any
In case you have debts or loans, try to pay off them with your savings funds if they are of higher interest. This way you can save money that is going to your lenders unnecessarily. Also, try to negotiate the interest rates with your lenders to at least save some bucks.
Limit Holiday Funds
It’s natural that you save money the whole year to celebrate your vacations or holidays. However, as holidays and vacations can’t be fully ignored they don’t need to expensive either if you live paycheck to paycheck. So, try to limit your spending for Christmas and vacation. Instead of buying expensive gifts, clothes, and halting in luxury hotels you can choose to prepare DIY gifts, buy gently used luxury clothes, book hotels with coupons, or stay in Airbnb accommodations. Doing so you can save a lot of money and celebrate vacations and holidays within the budget without having to compromise much.
If you spend more now on things you don’t need now, you will have to regret later thinking you shouldn’t have done this. So, to avoid such guilt it is better saving now and enjoy later. The above are 20 best and creative ways to save money even you are on a tight budget. Hope this unique list helps you save more money and boost balance in your savings accounts.