5 Tips That Will Help You Save on a Tight Budget
Are you feeling the pinch when it comes to your finances? If you’re scared of looking at your bank account and you feel it’s impossible to save, you’re not alone. In fact, according to the Report on the Economic Well-Being of U.S. Households in 2017, 40 percent of adults could not handle an unforeseen expense of $400.
Does that sound familiar? For many people, saving is tough. The good news is there are simple yet effective ways to save money when money is tight. Here’s how to save on a tight budget.
1. Make saving easy through automation
Have you ever felt like no matter what you do, you can’t seem to save? To combat this, you want to automate your savings. Don’t leave it up to willpower or chance — schedule automatic withdrawals from your checking to your savings account after payday. Saving 10 percent to start is a good idea, but depending on where you are at, you may want to save more than that or less. The important part is to save what you can. You can use a free savings app like Qapital to make saving fun.
2. Cut back over time
Some financial advice says to cut out any and all luxuries if you want to learn how to save on a tight budget. But like a fad diet, this strategy can backfire and the results are not pretty. You cut out everything, feel deprived, and end up slipping with a bunch of binge spending after a late night on Amazon.
Life is worth living and money is a tool to do that. So we’re not recommending you have no fun, but you do have to cut back somewhere. So let’s say you go to Starbucks three times a week. Start by switching it up and going twice a week. Then gradually, try going once a week. If you can cut back on one thing, you can free up some money.
3. Start meal planning
Be honest, how much do you spend on food each month? How much of that is going out to eat? If you go out to eat more than you eat at home, surprise! You’re part of the majority. In fact, the USDA Economic Research Service has found that spending on food away from home has steadily climbed past food spending at home since 2010.
I love a good happy hour or going out for apps with my friends as much as anyone but let’s be real — going out to eat more than you eat at home is a budget buster. If you want to learn how to save on a tight budget, it’s time to learn how to meal plan.
Meal planning for the week can help you stay on budget and never worry about answering the question “What are we having for dinner?” again. Also, it’s healthier too. Need some inspiration? Check out these tips and a template from ChooseMyPlate.gov. You can also check out BudgetBytes.com for some affordable and delicious recipes that won’t break the bank.
4. Go back to school
Want to learn how to save on a tight budget? Try going to a school for services and avoid paying full price. Next time you need a haircut or pedicure, go to a beauty school instead. Beauty schools, massage schools, cooking schools, and more can all offer their services at a fraction of the cost. Typically, they have an instructor nearby to make sure everything is going well, so you don’t have to worry too much that you’ll somehow leave with a bad ‘do.
5. Focus on the big three
A lot of personal finance advice will tell you to “Cut out lattes!” and imply you should never spend money on anything ever again. While we advocate for cutting back and saving, if you want to make huge strides in your savings you need to focus on your top three expenses.
For most people, their top three expenses are rent/mortgage, food and transportation. If you can work toward limiting your expenses in these categories, you’ll see even more savings. Here are some suggestions on doing just that.
Move to a cheaper place
Negotiate your rent
Put a room up on AirBnB
Take public transportation or bike or walk to work
Use GasBuddy.com to score the best gas prices when you drive
Get a cheaper car insurance policy that still works with your needs
Save money on food with coupons from Ibotta
Have items like frozen pizzas ready when you’re tired and want to go out to eat
Buy food staples in bulk
Putting your energy toward saving in these three areas will help you reach your savings goals faster.
Trying to save money on a tight budget can suck. We get it. It feels restrictive and hard to manage. But using these five tips you can make progress on your savings goals without too much pain and go after your big dreams and life goals.