The low-income earner says “How do I save when I earn so little?” “How do I make ends meet when all the money I make is invested into savings?” The feelings of this low-income earner are quite understandable. We all are habituated to think saving is a function of income only. Therefore, what we earn should solely decide how much we should save. But this is not always so. No one today who saved big did so because their saving was decided by their income.
Some factors premeditate savings and income is only one of them. There is interest rate, inflation, and financial confidence. These factors ensure no one is exempted from saving regardless of what they earn. If you are the type who reads opinions of income earners on reviewsbird.co.uk, you would be cognizant of the various smart ways of saving even as a low-income earner. But if you are not, perhaps reviews of saving accounts would do. Regardless, we saved you the time by providing you with this list of 5 smart ways to save.
1. Design a working budget
Most times, the income is not what matters but the decision. No one who saves has ever been less good than when not saving. We all as individuals adjust to budget regardless of the income involved. Small or big budgets, our needs rise to meet them. If you can cut out your needs, plan a committed budget, then you can save.
2. Reduce your housing costs
Housing expenses are some of the biggest problems of a low-income earner. The expense consumes a large chunk of your income. If that is the case, then you need to reduce them by exploring options. You can either change to a new location cheaper than your current or rent out rooms to make more money.
3. Eliminate debts
Debts are burdens on financial improvements. They are especially common among low-income earners whose needs and demands often rise to match their income. You shouldn’t minimize your debts. We are saying you should terminate them. Do away with them as soon as you can. Otherwise, even your income would be a burden to you.
4. Lower food costs and other expenses
Food costs cannot be ditched, so we are not advocating you eliminate them. We are saying you should subsidize them if possible. Look for cheaper food stores until you can afford the luxurious ones. Explore online shopping that comes with discounts and promos.
5. Automate your savings goal
You can set up an automatic transfer if you consider yourself not disciplined enough. Rather than force yourself to save which can prove unrealistic, automation can easily do this for you. You only need to set your saving habit (say 10% of every income you earn), add your bank details, and set the intervals you want the saving to be (weekly or monthly).
The Bottom Line
Saving has a spirit of its own that ensures you do not meet the target. You have to match your energy against this spirit and win. It requires financial discipline through commitment and diligence. With this, regardless of your income, there is no saving target you cannot meet.