Many people think that they can not save money because they have a low income. This leads them to hold off on saving until they start making more money.
The obvious problem here is that the day never comes where they feel that they make enough money to save. Then, they keep putting off saving money year after year. Does this sound like you?
Let’s make a change this year and start saving some money. Yes, you can start putting money away into savings even if you have a low income. Here are some tips to help you out.
1) Cut Your Expenses
If you have no money to save because you spend all of your income, spending less is an obvious answer. Almost any budget has room for improvement, no matter how tight you think things are. Here are some areas to consider.
This is a budget category that is ripe with opportunities to make cuts. If you buy fast food for lunch every day, just switching to brown bagging it can save you 100 dollars a month or more. That is over 1000 dollars in savings in just a years time.
Grocery shopping can be just as wasteful with most Americans wasting 10 to 20 percent of the food that they buy. Meal planning can change that by helping you buy only the things that you need. Just plan out your meas for an entire week, make a shopping list and buy just those items.
When was the last time that you got quotes for car insurance or a cheaper internet provider? We tend to get complacent and these companies take advantage of this by raising the rates little by little over the years. Shop your fixed bills, pay less every month and start saving.
How much money do you waste each month on services that you can do without. If you are still paying for cable or satellite, cut the cord. Paying for an expensive gym membership? Switch to one of the new discount clubs or start working out at home. We waste hundreds of dollars on things that we think we need, but really we do not.
2) Pay Off Revolving Debt
If you are having a hard time saving money and living paycheck to paycheck, chances are pretty good that you are carrying debt. Credit card debt needs to be eliminated completely in order to move on to a stronger financial future. With interest rates often over 20 percent, it is money that you can not afford to waste.
The first step in paying off that debt is to stop using your cards. Cut them up. Then, pay the minimum on all of your cards except the one with the highest interest. Pay as much as you can on it until it is paid off and then move to the next highest interest rate. Rinse and repeat.
3) Add An Extra Income Source
Many people do not make enough money simply because they fail to act. If you are working a basic 40 hour a week job, you most likely have extra time. Add some extra income and put all of that money into savings.
Even just doing some online survey taking could earn you 25 to 50 dollars a month. Over the course of a year, that is 300 to 600 dollars in your savings account.
Want to really earn though, pick up an extra shift at a local retail store like Walmart. They pay a lot more these days and are open 24 hours. This means that there is a shift to fit any schedule likely available. One shift a week could mean over 5000 dollars for your savings account in a year.
4) Open An Account
Sometimes the simple act of opening an account can be motivating enough. Once you start seeing money go into it and see it build, it can be quite addicting.
For best results, open an online savings account like this one from Discover Bank. Online savings have a number of benefits over going with a local bank. They pay more interest and they are harder to get to. You can still get to your money, it will just take a day. That can help prevent impulse buys with the money.
5) Set Up Auto Payments
Once you have that savings account set up, put it on auto pilot by creating automatic deposits or transfers. Make this happen on the day that yu get paid and you will never notice the money missing.
Even a few dollars every check can add up. Would you miss $10 a check? Probably not, but if you get paid every two weeks, that would be close to 300 dollars in savings in a years time.
Is that a huge amount of money? No, but it is a start and it is something that you can grow on.