Tips on Budgeting for Those with Low Income

A lot of people say that the only way to increase one’s savings is to increase one’s income. If that were true though, why do we have people like Lindsay Lohan, Mike Tyson and Larry King all filing for bankruptcy despite their high incomes? This brings us to the ultimate realization that it is not income that we should bank on but rather our lifestyle choices.

If you are one of those who are looking to fix your budget, check out these tips.

  • Always be on top of your take-home pay. Most companies these days have automated systems that calculate your pay after every pay period with little to no mistakes. This doesn’t mean we should rely on it completely though. We should always take some time to review everything. Be sure that any and all holidays covered were paid for. Likewise, any night differential should also be accounted for. Keeping your payslip in check helps ensure all loose ends are checked.
  • In line with the first item, be sure you know all the benefits that come with your job. That way, you can benefit from like medical reimbursement, sick leave reimbursement and the like. Be sure you avail of all these whenever possible. These count as non-monetary income but could help you save a lot.
  • Since you cannot control how much money comes in, you should instead focus on how much leaves your pockets. Grab a piece of paper or launch a spreadsheet program on your computer and start tallying your priority expenses. By priority, we mean those things which you cannot absolutely live without such as food, mortgage or rent, clothing and education. Other luxuries are not necessary and one should learn to live without these. Good examples are cable television, internet and other forms of entertainment.
  • Travel costs are also one thing which one can control. Walking or taking a bike is the best way to cut on costs and also help protect the environment. If this is not an option due to some constraints, going on a carpool would also help. Lastly, if even that is not an option, consider taking public transportation instead of using your own vehicle. Keep in mind that each day you save on fuel counts.
    • Lastly, one can also save on energy. A simple reminder to all family members that lights and appliances should be turned off will go a long way. Rather than resorting to heaters when the temperature goes down, try doubling or tripling your clothes. Also, washing dishes by hand will help save a load of water than using a dishwasher.