August 29, 2021

living on a budget


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When you are living on a budget or a tight budget, it can seem like everything is out of reach. You may be feeling like you are stuck in a rut with no way to get ahead or make progress towards your goals. But the truth is that there are many ways to live on a tight budget and still have fun!

Here are some tips for how to live more comfortably while sticking to your budget.

How do I Survive Living on a Tight Budget?

One of the central beliefs that led to my procrastination of saving extra money was that I thought everything was too expensive or difficult to afford. This was stopping me from living on a tight budget.

I realised this irrational belief and replaced it with a more reasonable opinion: "Everything may seem expensive or difficult, but it's not impossible". I then asked myself what behaviours led me to think this way and found that my mindset (i.e. thoughts, beliefs, feelings) was driving it.

There are plenty of things I can do without spending any money at all or spending very little: walking, biking, going outside to play with friends, reading books from the library. I wasn't optimising my monthly income to make a better financial life for myself.

The key to surviving on a tight budget is changing your mindset and prioritising what's important to you. If you go into a new budget thinking, you will be missing out. Then you will give up.

So without further delay let's get to the tips! 

1) Track Every Penny When Living on a Tight Budget

It's hard to know how much money you can save if you don't track every penny. The hardest part about tracking your spending is keeping it up, I find, but once you get into the habit of it, it's not that bad.

It just takes a little bit of time investment at first to develop the habit. Once you get into the habit of it, you'll find it enjoyable to control your money, and it will become second nature.

You can track your money in a variety of ways. It is good to pick some methods that work for you. Here are a few suggestions:

  • Notepad/diary: If you prefer to write things down using this method and do it daily, it will make you more aware.
  • Budget app: use an app like Cleo who will use artificial intelligence to let you know how you are spending your money and where you can make adjustments.
  • Excel budget template: Use a budget template on excel and keep track of your home computer.
  • Use a digital bank: Most digital banks will give you budget categories, making it easy to see your money.

2) Save Money by Using Money-Saving Apps

Several apps can help you track your spending on the go.

Remember, tracking every penny will help you learn how to live on a budget and increase your awareness about it. But money-saving apps can do a lot more than help you track. They can:

  • help you budget and tell you exactly how much you can afford to save (Example: Cleo)
  • Help you earn cash back on your purchases.
  • Help you earn extra cash by asking you to watch a few adverts (example, SwagBucks)

Here are two free apps you might want to consider downloading to help you on your tight budget journey.

Cleo

Cleo is a free app that helps you automatically save. Whether your goal is to build an emergency fund, pay off debt payments or save enough money, it can help. It links into your existing bank account on a read-only basis and takes your transaction data to guide you on how much you can afford to save.

Related post: Cleo App Review

Swagbucks

Swag bucks can help you save money and make a bit of extra money. Again, it's a free app that you download straight to your mobile phone.

It's simple to use. All you have to do is fill in surveys and watch videos to earn SwagBucks that convert into gift cards to spend at spaces like Amazon.

3) Set Real Goals to Stop Spending Money

Suppose you want to live on a tight budget. In that case, it is essential that you set reasonable goals because if it is entirely out of reach or unrealistic, that will make you give up.

Budeting goals

While on this tight budget journey, I asked myself what my real financial goal was, and here was my answer: My goal was to pay off my student loans.

Once I decided on my real goal, I knew that if I were able to save a certain amount of money, I would be able to live life a bit more freely as I would have fewer expenses. That motivated me to stick with it even though it can sometimes feel challenging when you have payments coming in: rent, food, bills, etc.

Once you know your top-line goal, start breaking this down into what it could mean for your monthly budget.

Start looking in your expenses and ask yourself:

  • Is there an unexpected expense that keeps coming up?
  • If you have a car payment, can this be reduced?
  • Grocery budget - are your food costs too high? Is there a cheaper alternative to your standard shop, i.e. Aldi
  • How many credit card accounts do you have? Can you reduce these to stop the temptation?
  • Do you have an unused gym membership, you could cancel

Figure out exactly what your financial goals mean to you and where you could make a big difference.

Need help with goals? Check out our ultimate Budgeting Tips Guide.

4) Take Advantage of Free Events in Your City When on a Tight Budget

Sometimes events and activities can be expensive, so I recommend taking advantage of free things to do in your city.

Look at Facebook groups: There are probably a few Facebook groups for people who like doing similar things as you in your area. For example, there are many groups for people who like hiking or biking in the same place. These are great ways to meet new people and experience things for free.

Check out your local Cities tourism page cities usually have a website to promote local events. You can find these sites by first googling "City Tourism" and then clicking on the link they provide for more information on their local attractions, etc. Sometimes there are even free concerts you can attend.

Join Meetup

Meetup is a social networking site where people meet up based on what interests they have. You can join like-minded communities and do fun activities with them for free.

Take advantage of Library resources. If you have a library nearby, I recommend using it because many libraries offer free things to do in your area, and lending tools such as recording devices or printers will an extra you.

5) Get Books for Free When Living on a Budget

If you like to read and are spending any money each month on books, you could cut this cost just by doing one of these four things:

  • Get Blinkist and to read the summaries of a book rather than reading the whole book. The app is free to download and gives you a free book each day of non-fiction books to listen to. I use it daily with my dog to keep up to date without losing lots of time.


  • Get a free library card. If you have a library card, you can get free books.
  • Ask your friends for their old books. Maybe one of your friend's is done reading a book and will let you borrow it with no strings attached.
  • Get an Amazon Kindle Unlimited subscription. With the subscription, you get access to thousands of books for $9.99 per month (less than $2 per book) and can read these books on any device connected to the internet!

6) Make Your Meals Instead of Eating out all the Time

Meal planning can save you hundred per year!

If you eat all your meals out, you pay for someone else to cook and clean up after themselves. It would be much cheaper (and healthier) to make your food.

7) Cook More Food at Once so you can Take Leftovers to Work

This will save you time and money.

If you have a slow cooker, I recommend using it to prepare some meals. It functions more like an automated cooking device that takes all the guesswork out of organising your food.

It's usually cheaper to buy the ingredients in bulk, then divide them into plastic sandwich bags or Tupperware containers so you can keep the food and use it on another day.

8) Save Before you Spend (Pay Yourself First by Using a Savings Account)

Before you spend any money, put some of your income into a savings account. It will make it easier to save if you don't have any extra cash lying around the house or in your bank account. This form of saving is called paying yourself first.

It's an excellent technique that will help you not to overspend, and you will start each month with positive action.

9) Be Honest About Necessity Vs Wants When Saving Money

needs vs wants

The best thing to do is ask yourself if you need whatever it is that you want. If the answer is yes, then go for it! Don't let your wants get in the way of things that are important to you.

If it's a want, then put some money aside and wait until later to buy it. You will find by waiting for, let's say, 30 days, then in that time you will probably find you don't want it and it was just your impulses taking control.

10) Kill Your Debts as Fast as Possible, Especially Credit Card Debt

Be honest with yourself about how much debt you have and what your interest rates are. Then create a game plan to pay off these debts as quickly as possible because most likely, the longer it takes you to pay off that bill, the more money you will end up paying in fees or interest.

kill off your debt

If this is currently something you don't have the means to do, I suggest searching for ways to pay off your debt in the fastest time possible. You can ask family, friends or even a financial adviser how you can make the best payment choices and finally get this monkey off of your back once and for all!

11) Review Your Progress

Make a goals list of things you need to accomplish, then put your name on the line by promising yourself that if you finish everything on this list before the new year starts up, you can treat yourself or let loose and have some fun!

Put dates to your goals and keep reviewing them. It will keep you motivated and in the game.

review your progress

Be kind to yourself.

Don't beat yourself up over past mistakes. If we're honest with ourselves, then we will all admit that most of us have made a mistake or two in our lives, but what is done is done, and we cannot change the past, but we can learn.

12) Review Your Bills

Find out how much debt you have and what the interest rates are on these debts. Find a way to cut your expenses without losing the things that are important to you. If your bills keep piling up because you cannot pay them off, then take action now!

review your bills

Do not look at this as a weight or burden because once you put some time into reviewing your financial situation, then you will see that this was meant for good in the long run. It is a chance for us to step back from all of the craziness in our lives and either do something about it or take our minds off of it so we can move forward with our lives.

Find out if you have any subscriptions that you are paying for but aren't using—for example, Netflix or Hulu. If there is something that you aren't using and it's just taking up money from your bank account, then get rid of it!

Kill the junk food

Are you spending a lot of money on junk food? Try and cut back by looking at how this is impacting your food bill.

Limit entertainment expenses

Spend time with friends and family but don't go out every time they ask you to. Trust me when I say that these people will still be there next week or the month after. Go to their house instead and bring some drinks and snacks for everyone!

Find ways to save money at home

Do things around your house yourself. For example, if you need to fix something like a leaky faucet, spend an hour or two figuring out how to fix it rather than spending $20 on someone else who will show up late and not even try to charge as much as possible. Do this for all of the things that are broken around your house. If you can take small steps yourself, then you won't have so many costs adding.

13) Carpool

Save on gas money by carpooling with other people. This is a great way to avoid the stress of rush hour traffic and save some cash in the process! It's also so much better for the environment! 

carpool

14) Buy Generic Brands Instead of National Brands

They are almost always the same anyways. Don't take money for granted. Start by swapping out brands that don't really matter to you like bleach or maybe even shampoo. Then just keep building and see if you actually notice a difference in the store brands to your branded. 

15) Take Advantage of Nature for Exercise

Go for a walk, ride your bike to work, and even take the stairs to get up a few flights! Don't spend money on things that will drive up your costs at home when you can be getting exercise out in nature. You will also feel better for being outside in the fresh air too!

exercise outside for free

16) Plan a Staycation

Treat yourself to a staycation once per month! This is something that I love doing, and it is straightforward to do. When I need a break or am about to go crazy from the daily grind, I will take one day and check into a nearby hotel to spend time with my family. Watch some free movies, have a bath, and get healthier while having fun!

plan a staycation

17) Make Gourmet Coffee at Home

Cut back on those trips to Starbucks. Buy your coffee maker at home so you can brew your drinks for half of the cost without all of the added sugar/calories. If you want to splurge, try getting a cold brew instead, which has more antioxidant properties and prices less than getting a latte every morning.

make coffee at home to save money

18) Never be Afraid to Trade or Barter

I'm talking about that old-fashioned style of trading where you help someone in return for something they do. You might be able to barter some services at your job or find someone who needs a favour and offer them a deal. This can save you thousands!

19) Stop Eating Out so Much

This is easy, but always remember how much restaurants will cost you over the year compared with what you could have done inside your own home. Even if I go somewhere and get lunch, it will be around $10-$15 per person versus making it at home, which would only cost between $5-$7 per person! That's quite the difference!

Bring your lunch from home more often than not.

20) Consider Living Close by Your Work

Cut back on spending money on gas by finding ways to live closer to your job! This is a great way to reduce costs while also having some extra time for yourself.

21) Choose a Budgeting System That Works for you

You don't have to use a budgeting system that someone else has created. You can find ways to do it on your own. Look at your spending over the month and then create categories for everything that you spend money on. This way, when you look at your bank statement or chequebook, you will know exactly where your dollars are going.

My personal favourite is the 50/30/20 budget because it just makes budgeting simple and you actually plan to for fun too! 

pie chart split into 3 showing 50/30/20 rule budget 50% needs Housing Groceries Utility Bills Transport insurance 30% wants gym shopping 20% savings

21) Utilise Credit Cards Wisely

Credit cards can be beneficial if used properly. Just remember that 1% cashback is nothing compared to rewards points, miles, notes, and extra benefits like insurance coverage and extended warranties! Remember always take advantage of sales.

Only use credit cards if you know you can use them responsibly and pay them off once the bill is due. If you see, you will be tempted to buy new shoes etc. Then it's a good idea not to have any credits cards.

Any bonuses that credit card companies are offering won't be worth it if it ends up putting you in debt.

22) Shop at Secondhand Stores (or Thrift Stores)

One day you will be able to look back and tell the grandkids about your Thrift store days! Appreciating what other people have done with their belongings versus always buying something brand new can save a fortune over time. Sure, maybe that shirt might not last quite as long, but it doesn't take much of an investment to find a sweater for $1 or free to save hundreds of your dollars.

Pick up a hobby that isn't too expensive, like photography, making plants grow super fast in the dark, or knitting! It's a great way to spend some time, but you can even make money while doing so with sites like Etsy and eBay! You could also start a blog!


 23) Spend less on going out and more on other things (Prioritise what's most important to you)

Staying in is just as fun if you have the right company. I am personally a huge fan of board games, cards against humanity, and conversation.

Make pancakes at home for breakfast instead of going out to eat each morning (it's a straightforward recipe!) You'll save about $5-$10 per person with this one or more if you share.

 24) Have a No-Spend Month

Just have a month where you don't buy anything but the essentials. If you're having a hard time with this, try making a list of what's essential and then crossing items off until you've got your month planned out.

Sometimes we buy things that we don't need just because it's there and when you see it, but if you walk away from the store or drop it off at the counter, they won't miss having your sale.

 25) Stop Buying Bottled Water!

If you think about it, one bottle of water can be around $2.50-$3.00 or more, so it's effortless for this to add up if you don't watch it. If you have a water filter at home, use that and turn the tap on for free!

You could also consider getting a Brita water pitcher or simply buying a reusable bottle.

 26) Make Your Gifts to Save Money Living on a Tight Budget

This one is pretty self-explanatory, but I think this goes along with buying secondhand. Even if you purchase something new to make a gift (like cookie cutters), it's still cheaper than buying a pre-made gift from the store.

Sharing is caring when it comes to gifts too! If you are looking for ideas, ask your friends what they need and use that info to get them a fantastic homemade present.

 27) Sell Stuff You No Longer Need a Tight Budget

It's effortless to keep things that we don't need or haven't used in years. Sometimes when you want money, all of a sudden, you will be motivated to sell these items too! That way, you can use the money for something else instead of sitting around taking up space.

You can also sell things on Craigslist, eBay, or even some Facebook groups. You'd be surprised at what people are willing to pay for old books!

All this time, we've let ourselves think that the only way to live a comfortable life is if you make a tremendous amount of money so you can spend wildly. This couldn't be further from the truth! Living on a tight budget and living the way you have been can be pretty comfortable when you learn how!

Final Thoughts on Living Well on a Tight Budget

Living on a tight budget can be difficult, but it doesn't have to doom you to a life of poverty. There are plenty of ways that living within your means will make for an enjoyable good life! You can work towards your best life by applying some budget principles; the key is to cut expenses on things that don't matter to you.

This article has given some great tips about how you can live more comfortably while still sticking with the demands of your finances. It's possible that you could now have extra money.

How do you feel about living on a tight budget? Which idea from this guide do you think would help most? Let me know in the comments below.

P.S if you liked this article please share.

About the author 

Mary Elizabeth

Founder of MeMoreMoney. A self-taught finance nerd, learning by doing and experiencing. Bought first house at 21, paid off student debt, and save 100k by 30. Featured Personal Finance Expert in GO Banking Rates and Yahoo! Finance

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