If you live from paycheck to paycheck, the thought of saving money for an emergency fund or paying cash for a vacation may seem impossible. But, it's really not with these tips on how to save money when your budget is tight:
Just Get Started
It may seem overwhelming when you really think you have nothing extra, but just do something to get started. That's often the hardest step - overcoming your fear that you can't do it or it won't work.
Unless you are directing your money with a budget, you'll never have money left over at the end of the month for the extras. There will always be something that will pop up that you need to pay for that takes all your money.
First, you'll need to track your expenses and then create budget categories. You might be completely surprised where you are spending money! Rather than being confining, a budget can actually free you to spend money since you know exactly how much you're allowed to spend without busting your bank account.
If you can't budget for a full month, you can start by breaking it out weekly (or even daily). We split our grocery budget into weekly chunks to make sure we're staying on track.
Cut your Expenses
Look for ways to cut your variable expenses (the ones that change each month). You could start couponing to save money on groceries, cut back on your paid TV, eat at home more, etc. Check out these 10 expenses that you can cut now.
Get Out of Debt
If you have debt, try to pay it off as quickly as possible (and stay out of debt). Any money that you paid towards your debt can now be spent on building your savings fund.
If you truly have nothing to spare with your current paycheck, explore ways that you can increase your income by taking surveys, etc. You could even take on an extra job during the holidays (or during nights or weekends) to raise some extra cash.
Adjust Your Attitude
If you're trying to keep up with the Jones', but you just can't quite afford their lifestyle, you likely need to make an attitude adjustment. Determine that you can't have it all, and prioritize what's important to you. Budget for those things that are important to you and cut expenses in other areas.
Make Growing Your Savings Fun
Keep track of how much your savings is growing and celebrate the milestones. Perhaps, you can set a small splurge for each milestone that you hit. It really can be fun to save, rather than stress about money all the time!
You can painlessly start saving a little money here and there by putting your change in a jar and saving it over a period of time.
Based on your budget, determine an amount that you can save each month, and have it transferred automatically each month to a savings account.
Try a No-Spend Month to kick-start your savings
Basically, you designate a month as a no-spend month. You use up the food in your fridge/freezer pantry and try to avoid spending any extra money. You can add the money that you save during the month into your savings.