When your income is meager, it is difficult to learn how to spend your income. Without management, it can wipe out even the best of savers with one emergency, making it hard to recover to your comfortable spending. To best manage and save your low income, you have to embrace particular spending habits. The following are ways to control your daily costs and improve your saving habits by squeezing out every penny’s worth from your low income, even when you hit rock bottom.
Track your Finances
You will never know how much you are spending from your income until you diligently track your expenses. Tracking your expenses is the basis of your financial management. The knowledge of your costs is essential to determine which expenses to do away with or reduce. There are some methods to track your expenses. The simplest way is jotting down in a notebook and keeping your receipts. The most effective and modern way of tracking your expenses is by using personal finance mobile applications. There are many applications in the google play store or the apple store that are free and can track all your expenses such as Fentury, Receipts by wave, Expense Manager, Expensify, Hello Expense among others.
Create a budget
Creating a budget is a vital step in controlling your financial life. To create a budget one needs to track their finances for about a month. Because of these expenses and spending fees, you get an estimate of where a bulk of your money goes. You can then create spending categories such as entertainment, food, transport costs and income. Once you have a budget, prioritize the essential commodities. Food, clothing and house bills are imperative and non-reducible. The next item on your budget is savings. Savings are vital for rainy days. No matter how low your income is, always save because during an emergency you will have little to no choice in taking away your pay to get out of the situation. Understand that if you do not save, after an emergency you will be living from paycheck to paycheck.
Self-control sounds like an easy task, but it is not. Learn to restrain your urges from some daily life pleasures that you cannot afford now. The urge to buy trendy items in the market and spoil yourself occasionally. Say “no” to a necessary stuff that at the time you do not need. Refrain from impulse buying until the time you can afford it. Practice it at least once a day. Refrain will improve your self-control during tough times, and in the end, you will appreciate the valuable habit of just saying “NO.”
Tackle High-Interest Debts
To encourage savings, you have to pay off high-interest debts first. You should first deal with these debts whether they are personal loans, or credit cards, or even leverage. Solely because they force you into paying outrageous fees and interests, which is unhealthy when managing low incomes. Tackling high-interest debts helps you to avoid accumulating any more high-interests especially when it comes to bank loans.
Do-It-Yourself projects are a more relaxed way of saving money on your income. Instead of purchasing most of your supplies, try making your supplies. Grow your vegetables, making your cleaning supplies instead of buying them or even cooking instead of going out to dinner. These projects will save you much money, empower you and also have some fun while at it. The DIY projects will give you an alternative option to your expenses.