Skip to main content

How to Save Money on a Low Income

Ever since I was a kid I was brought up to be frugal and to save and budget money. * Disclaimer: I am not a financial planner.

10 Ways To Save Money On A Low Income

If you're having trouble saving money, running out of cash every month and wondering how to live on a low income, here are 10 tips to help.

  • Create a budget

Setting up a budget is the first step in learning how to live on a low income or tight budget. Your budget will show where all your money is going and help you identify areas for improvement (for example, do you spend too much eating out?).

  • Try a no-spend challenge

A no-spend challenge is when you don’t spend any money for an entire month or longer—and it can be incredibly helpful when trying to learn how to save more effectively! It’s important that during this time period, you still pay for necessities like rent/mortgage payments as well as utilities such as electricity and water but other than those expenses everything else is considered off limits – including food shopping! When trying this approach make sure that there are no exceptions made otherwise it defeats the purpose of learning how not only save but also live without depending on things like food shopping trips which can quickly add up over time leaving little left over at month end which means less cash available each subsequent week until there isn't much left at all."

1. Make a budget

You don't need to be a math wizard or an accountant to make your first budget. The most important thing is to write down all of the money that comes into and goes out of your life each month, so you can see how much money you actually have left over after paying for regular expenses like rent, groceries, and gas.

The best way to do this is by using an online tool like Mint (which we'll talk about later on in this guide) or a good old-fashioned pen and paper. You can also use Excel or Google Sheets if you're more comfortable with spreadsheets—just remember that your goal should be clarity over all else!

2. Try a no-spend challenge

  • Try a no-spend challenge.
  • Make a list of things you will not spend money on and then make another list of things that are essential.
  • If you can stick to your plan for at least one month, you will have saved yourself some money and probably noticed some changes in your lifestyle as well.

3. Learn some frugal habits

  • Learn to cook at home. This is one of the most important things you can do for your budget. You'll save money by not eating out and buying pre-made meals from the grocery store, and you'll also know exactly what's in your food (and whether it's good for you).
  • Buy staples in bulk when they're on sale and only buy enough to last until the next sale. If there isn't an item on sale that you need right away, don't get it now! If you wait until it goes on sale later, then stock up then instead.
  • Make your own cleaning products and beauty products if possible (especially ones that come with a lot of packaging). Some examples include: homemade window cleaners; homemade air fresheners; handmade soap bars made with olive oil or coconut oil; DIY shampoo; etc...
  • Make your own laundry detergent using borax, washing soda and essential oils such as lavender or lemon grass oil instead of purchasing expensive name brand detergents like Tide or All Free Clear Laundry Detergent Liquid . You will save so much money making this yourself because these ingredients are inexpensive compared to other alternatives out there! Plus with essential oils added into each batch makes everything smell fantastic too! Your clothes will smell amazing after washing them at home vs going through another cycle with store bought brands like Downy fabric softener sheets which cost nearly $20 per box at Walmart."

4. Look for low-income assistance programs that can help you save

If you're on a low income and looking to save money, look for low-income assistance programs that can help you save money on food, utilities and other bills.

In addition to helping with utilities and food expenses, look for programs that help with transportation costs (such as public transit), education (including college tuition) and healthcare (such as insurance).

5. Put your money in a high-interest savings account to grow more money

If you're looking for a way to grow your money, but don't want to risk it by investing in the stock market, one of the best ways to do this is with a high-interest savings account. You can open an account at a bank or credit union and reap up to 10 percent interest on your savings each year. Some banks offer higher interest rates than others, so do some research before choosing one.

You can also consider opening an account with a brokerage firm if you have more money and want higher returns on investment (ROI). This will require more research on your part because there are many companies that offer these types of accounts, but they all have different requirements for opening and maintaining them.

6. Minimize interest costs with a secured credit card

Secured credit cards are a great way to build your credit history, and they can save you money on interest as well.

Secured credit cards are essentially the same as regular ones in terms of how they work, but they require a deposit that acts as collateral for the amount of money you borrow. With this type of card, if you don’t pay off your bill each month then the issuer will simply take out more from your account—so it’s important to keep track!

If you have poor or no credit history at all then secured cards can be an excellent way to start building good habits with borrowing and repaying money promptly. They’re also helpful if someone else is responsible for paying off all or part of your debt (for example, parents taking over payments for their child) because there are no fees attached except those associated with making purchases—which makes them less risky than having actual debt like student loans or car payments hanging over one's head!

Scroll to Continue

7. Get creative with childcare when you need it

  • Get creative with childcare when you need it

When a child is at the age where they’re old enough to be left unsupervised but too young to be in school, it can be challenging to find a good babysitter or daycare provider. If this is an issue that you’re facing, here are some things that might help:

  • Consider babysitters: Maybe there's someone who would watch your kids for free as part of their job as an au pair or nanny? Or perhaps you know someone else who watches other people's children at home and could take on yours as well? If this doesn't pan out, maybe there's a friend who knows how much care parents should provide—and could fill in while they're away.
  • Get creative with family members: This one may not work if your family lives far away; however, many families live close by and are willing to help out when needed—even if it means putting in overtime at work so they don't have time for anything else! Even if someone has never watched a child before and thinks he/she might not like being alone with them for long periods of time (or any other reason), try asking anyway—you never know until you ask!

8. Avoid costly emergencies by having an emergency fund or rainy day fund

You should also have an emergency fund, or rainy day fund, that you can use to cover unexpected expenses. This is useful if something breaks or needs to be replaced unexpectedly and you don’t have the money available in your normal budget.

How much money should go into the emergency fund? That depends on how much risk you are comfortable with and what kind of emergencies you might face. Ideally, this shouldn’t be a small amount of money—you want enough so that even if there is a major car repair or medical bill, it won't take everything out at once and leave nothing for other needs until your next paycheck comes in. It's also important not to use these funds for anything else unless it's absolutely necessary (like paying for rent if you don't have any other options). When deciding how much goes into this account each month, consider how much income fluctuates over time (for example if someone works seasonal jobs), as well as any larger outlays coming up soon like replacing appliances or buying furniture for an apartment move-in date later this year!

There are several ways people save up their rainy day savings: some set aside $1 from every paycheck; others save whatever extra cash they earn throughout the year; still others use direct deposit programs which automatically put aside money into savings accounts without them having access until they withdraw it later on downline roadways after leaving work one day...

9. Know your rights if you’re facing debt collectors (and read your mail)

If a debt collector is harassing you or threatening to garnish your wages, there are steps you can take. You can:

  • Tell the collector that the debt is not yours, and ask them to stop contacting you.
  • Ask for validation of the debt so that it's clear what they're talking about.
  • Contact a lawyer if necessary—but only if it's necessary! If your problem with collectors isn't serious enough, do some research first and make sure it's worth calling in an attorney before doing so (and don't give away any information).

10. Minimize insurance expenses with comparison shopping and by choosing term life insurance over whole life*

Insurance is a necessity, but you can save money on your premiums by spending time shopping around and comparing different policies. Term life insurance will provide coverage for a specific number of years (typically 10-30) and it's usually less expensive than whole life insurance.

  • Find the best term life policy for you: Shop around to get quotes from multiple insurers online or in person. You can also check out websites like NerdWallet or Bankrate that offer free comparisons between different providers' rates and plans. If your employer offers benefits through an HMO or PPO network, find out if there are any lower-cost options available outside of those networks before going with one of them.*

The best way to find the best protection against financial calamity: Life insurance is designed to replace income lost when someone dies prematurely—but not everyone needs this kind of protection right now! If possible, try living off what you currently have saved up while saving aggressively towards retirement instead (some experts say this will help keep peace between spouses if one partner wants more security versus taking risks).

Saving money isn't always easy, but there are some steps you can take to make saving money easier when you have a low income

It's not easy to save money when you have a low income. But there are some steps you can take to make saving money easier.

  • Cut out unnecessary spending: If you're making less than $30,000 per year, try cutting out unnecessary spending. Think about how much money each purchase costs and whether it's worth it. For example, if the kindle unlimited subscription costs $9.99 per month and only allows you to read 10 books in the month instead of buying one book for $15 dollars at a time—then perhaps buying that book is more cost-effective than paying for the subscription service where none of your books will be available until after midnight on any given day that month!
  • Create a budget: Create an accurate budget based on how much money comes into your household each month as well as what expenses come up throughout the year (car repairs, holidays). Keep track of every dollar spent so that if something goes wrong with one expense category then an adjustment can be made later down the road without too much hassle involved!


If you still find yourself struggling to save money on a low income, don’t be afraid to ask for help. You can start by reaching out to your local community organizations or social service agencies, who may have some good suggestions for you. They may also be able to point you in the direction of other resources that could help you get back on track with your finances.


This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2022 Shanon Sandquist

Related Articles