How to Manage Your Budget and Save Money on a Low Income

How to Manage Your Budget and Save Money on a Low Income

Has your work-from-home career started to carry big financial benefits yet? If you have started your work from home career recently and are struggling to manage your budget and save money on a low income, you have two options:

  • Find additional sources of income
  • Track and limit your expenses in all possible ways

We wrote the articles: “Top Business Ideas You Can Start without Money Invest” and “5 High-Paying Remote Jobs That Pay Over $100,000 Annually“.

The key to managing your money while working from home is through adopting the right habits. Gretchen Rubin, author of the self-help book Better Than Before, says “For good and bad, habits are the invisible architecture of daily life.” Indeed, habits are the driving force in our lives. But, it’s you who have to be in full control of your habits, not the other way around. Good saving habits go a long way towards keeping money in your bank account.

3 essential habits that will help you establish long-term financial stability

Stay positive

Positive mindset does miracles. Put the negative thoughts away. Start with creating a positive mindset about your new money goals. It’s important how you feel about this new change. You have to believe you are able to reach financial stability and enjoy a stress-free life while building your work-at-home career.

In this sense, here are a few assertions that will enhance your motivation.

  • I can do well with budgeting.
  • My parents taught me to be honest and transparent when it comes to money management.
  • I need to stay away of debts if I want to enjoy financial freedom.
  • I’ve learned my lessons. I am aware that money carries a lot of responsibilities which I am able to handle.
  • I can make the right money decisions.
  • Saving money is not new to me.

Tell this to yourself every day, but more importantly, believe in it. You can add more assertions if you think it’ll help. Write a new one to this list every day.

Practice Self-control

Learn to restrain yourself from some daily life pleasures you can’t afford right now. It’s easy to buy new things and spoil yourself every once in a while. But, if you buy more than your budget can handle, you might have to say “no” to to a necessary stuff at the time of need.

Refrain yourself from purchases that you want to buy (but don’t need) until you can afford them. Practice this at least once a day. It will improve your self-control. In the long-term you’ll appreciate your valuable habit of  saying “no”.

Be aware of all your money

Once a week pay a check for the money you keep in the bank. Schedule this as an event in your calendar so that you won’t forget about it. In that day, go thoroughly into all your accounts – debt and credit cards, PayPal accounts, saving funds and all other places you keep a certain amount of money. This is the best way to monitor and stay aware of your cash flows.

4 painless ways to manage your budget and save money on a low income

Go back to basics

What’s the basic truth that lies in the heart of every financial goal?

Spend less money than you make.

That’s the golden rule that holds the key to a steady financial budget. When your expenses exceed your income, you are at a huge risk of falling off the financial wagon.

Keep track of what you spend

Managing your finances can be either easy or quite challenging. I recommend to keep it as simple as you can. Only then you’ll be able to manage it. Build a simple budget. Organize your needs and expenses into categories, but avoid creating too many of them. It will only complicate things and that’s not the point.

Instead of having categories for money spent on books, movies, video games, clothes, concerts, or nights out, put everything in a single category named “Leisure Time Activities” or “Fun Activities”. Take a good look at it and think of what part of the expenses you can take out. Fortunately, there are plenty of budgeting tools available online you can take a good use of, such as Budget TrackerMintYouNeedaBudget, etc.

Needs vs Desires

Most of the time we spend money in particular areas that refer to our needs. We buy groceries, transportation, and housing. However, we also tend to spend a lot of money on things that we don’t need so badly. We do want them but we don’t need them. These are magazines, Satellite TV, gym membership fees, and so on. It’s really nice to have them for they bring simple pleasures to our lives, but when they make a burden to your budget, you should get rid of them. Cut down all spending that don’t fulfill your basic needs. That’s the only way to stay financially fit, at least until you start earning more money from your work-from-home job.

Speed grocery shopping

Typically, groceries are what people mostly buy almost every day. Therefore, it would perfectly make sense if you try to improve your grocery bill to save some cash. When you shop fast, you are able to buy everything on your list. Plus, there won’t be enough time to get seduced by other items at the store and make an instant purchase. This approach perfectly applies when you have kids to shop with. Here is how it goes. Plan your meal in advance and decide what groceries you’ll need to prepare it. Take a look at what you already have. Make a list. Add only the things you need and strictly follow the list.

Final Words

Set financial goals and focus on achieving them. That’s the ideal way to manage your budget and save money on a low income.

What do you think of these habits and tips? Do you have something to add? Share your thoughts in the comments section below.