More and more of us are trying to make ends meet on a tight budget. This is a guide about living on a tight budget.
Read and rate the best solutions below by giving them a "thumbs up".
It took me several years, but I finally figured out how to manage my families finances so we never worry about the bills.
First, I used a windfall (could be a tax refund, holiday gift, inheritance, bonus, etc.) to get a month ahead of my bills. This means any money received in January is for February living expenses. Don't use direct deposit unless it goes directly to a savings account. You are likely to use it before you mean to if you put it in your checking account. Otherwise just hang onto those checks until about 4 days before the first of the month. Then deposit the checks or transfer from savings into your checking.
When you make your deposit, get cash back for regular items such as gasoline, allowance for kids or the working person, groceries, and money for things like a night out, movie rental, haircut, etc. We call those incidental expenses. Put the cash into a coupon holder - one slot for groceries for the month, incidentals, gasoline, etc. That's all you should spend for the month on those items.
Write any checks for bills due the first of the month. Then whenever a bill comes in, pay it right away. Part of my going through the mail is writing checks for bills received and getting them ready to go out in the next day's mail.
When you are at the bank (I only go once a month to do all this), transfer into another checking account money used for bills that aren't monthly, like car insurance that you only pay twice a year, or property tax, home insurance and auto registration paid only once a year. Each month you put only a month's portion of the total bill for each item into that second checking. Then when the bill comes, the money is there because you have been saving for it bit by bit all year. You don't have to take it out of savings. You can do the same thing for clothing, school supplies and outings, gardening, home and car maintenance, whatever your categories are.
This way everything that's left STAYS in savings. The bills are always paid right away and there's money earmarked for the big non-monthly bills and other living expenses. You can make it a habit to never go into your savings account to pay bills by using this system.
The next windfall you get after starting this should go directly into savings. You'll soon find you have a good back-up in case of job loss or emergency expense.
Padma in Pima
In an effort to stay as much on a budget as possible and track my spending I have finally found an easier way. I keep my check book in my purse and use is to record my deposits and withdrawals, of course, but I also keep a small ledger in my purse.
I have all my bill and savings categories labeled at the top of the page. Every payday each category gets a dollar amount added into its slot. Some categories get 0 and others get the same amount each payday. Luxury categories might only get more than a 0 when I have a overtime check.
Every time I spend money from a category it gets subtracted. Sometimes you have to spend money from one category to cover another categories' expenses especially at first when you do not have a lot built up in each category, but at least you see where your money is going and where your spending weakness lies (like buying too many clothes for yourself or spending too much on gifts each month or fast food etc.)
The sum totals of all the categories must add up to your current checkbook balance to work. You must balance this book just like you do your check book. Do it every time you write a check or use your debit card, it is easier than it sounds and will become habit and fun once you get the hang of it.
It is an easy way to save money for insurance and other large pending bills, Xmas, vacation etc without having to have more than one account. Also it keeps more money available in your checking account for emergencies and helps keep your daily average balance higher in case of accidental overdraw God forbid.
Of course there are Christmas clubs and savings accounts but this way if you have a gift category, a christmas category, etc you have the money readily available all year and can pick up really good sale items for special people as you see them during the year and not feel guilty about it because it is in your budget! You can just store the treasure until the birthday or holiday come along. Hope this is clear. Good luck!
By grandaaww from Richmond, KY
There's no quick fix for the economy, and jobs are disappearing daily. Even seemingly secure jobs are causing some people to look at their futures with a budget cutting scissors in hand. If it makes you feel better to cut back now in preparation for the worst, then by all means cut back. Maybe drastic cutbacks aren't such a bad idea anyway. After all, we could all use some extra cash these days.
Find out when your contract expires and note the date. Avoid early cancellation fees entering your life by opting not to renew the contract. It's the perfect time to buckle down and cut back.
Going without your cell phone plan doesn't mean going without your cell phone. Pay-As-You-Go plans allow you to cater your monthly budget accordingly. The committal to extra fees is gone, and so is the outrageous phone budget. It also works well for teenagers since they can be responsible for their own minutes. No money this month? No minutes. It's an easy lesson that anyone under eighteen can learn.
Gas prices may have fallen, but it's not a bad idea to trade down on your vehicle. Large trucks not only use more fuel but also cost more for repairs and yearly tags. Are they worth it? For some, the answer is an adamant yes. For others, maybe not. If you're driving a heavy duty pickup just to haul weekend toys, you might be able to downgrade your vehicle and pick up a cheaper, lighter trailer.
Similarly, if those monthly car payments are taxing, imagine what they'll feel like if job cutbacks affect you. Trade in now when you're not feeling so desperate and opt for something that's softer on your budget.
Try to gradually tighten your utility budget belt. This month eliminate one premium channel listing. Next month, drop call-waiting. Then, caller ID followed by DVR services. Could you drop your voice mail service and purchase a cheap answering machine instead?
I remember the morning when I watched the stock prices scroll across the bottom of the TV screen while I was watching the weather forecast. It was 5 AM, and I wondered if I was watching history happen; every stock was preceded by a red arrow that noted a drop in its value. It may not have been the landmark day of 1929, but it was close.
For those of us who are fortunate enough to have jobs, stable mortgages, and some minor senses of stability, we're maintaining. It's not a time to play with our money or make risky decisions. Yet, a few experts are reporting that it is a time to take advantage of the weak economy.
For those who hold 401K investment plans that are mostly invested in stock, stay there. The quick rush of rats to abandon the sinking ship is over. Those who ran the mooring lines and left the ship early enough may have saved money, but now that the stocks fell the ship has sailed. Investors suggest that you now wait it out; wait until the ship docks again and you recoup some of your money before scampering out of your investment.
However, know your budget. Purchase these items only if your budget can handle them and you're one of the lucky who can afford them. Don't buy items on credit and don't empty the bank account to purchase them. Shop wisely, and you can take advantage of the hard times.
Those who once drove gas guzzling vehicles or luxury sedans with high monthly payments have opted to trade in for more reasonable cars. In steps the weekend camper who is in need of a heavy duty truck at a low price. Today's the day to find it. The business who needs a company car for clients and sales calls can pick up a luxury sedan at a good price as well, either on trade in or repossession resale.
My family is now not just one percent poor side, but my parents are poor now too. I have always lived frugally, but now my mom has returned to frugal living just to survive, and I am reteaching her what she has forgotten, and the new frugal sources as well as the old ones.
We go to the thrift stores together now, and I am teaching her how to appreciate and shop thrift stores. Dakota Boys and Girls Ranch is an excellent place to get new overflow from Target at cheaper than store price. Clothes for children can be had at a good cheap price and a third of the price too. The clothes we look for are Target brand, and new tag clothes. Instead of $25 jeans, it is $4 for the same jeans that are name brand.
I get a couple for my children, and my one niece whom I now raise. My brother whom is my niece's father has custody, and he told me to help raise his daughter, and the only way I know how to is frugally by sewing dresses made of yellow and pink. I get to crocheting too, as my source for mitts and scarfs for all my children is yarn from thrift stores.
My other past time is coupon clipping which my sons do with better accuracy than me. I passed that gene onto my children. We have a garden for our veggies, and seeds come cheaply from dollar stores in my area. I raise my children to be respectful and honest when it comes to living frugally. One doesn't have to cheat the system to do it.
Our rent is rent controlled by an understanding landlord, otherwise our rent would be a hardship on our family. We live in a two-income, limited budget of $1400 combined. We each get about $700 a month. This is the last year for rent return from the state, as they will not be doing it next year, so our rent return will be saved for clothes that are not thrift store buyable, or sewable.
Shoes are bought at a Payless Shoe store two times a year. One for winter, and one for the rest of the year. Shoes are a spendy adventure for a family of 14 that includes one niece, two adults, and eleven children. All of various ages. Hand-me-downs, thrift stores, and occasional garage sales help, but mostly hand-me-down clothes.
For furniture we go to the thrift store again. I also shop for dollar store bean bag chairs for my teen son and daughter. I love the fact that people donate Snoopy and Winnie the Pooh stuff. They sell them cheaply at rummage sales too, but I guess one person's clutter is our family's gain.
I shop at Family Dollar, and Dollar Tree in Dilworth and PR for groceries and personal items for my family. I stopped shopping at regular grocery stores long ago. I make my own cleaning supplies out of items like baking soda and vinegar. I have not spent one penny on bleach or 409 in years. I clean my windows with vinegar and lemons with water as a solvent. It works well.
My family is happy and we do not feel deprived one bit. Teach them young not to want name brand and you get frugal adults. That is what I always was taught and personally have been quoted by friends and family. My children have excellent imaginations, because I raised them to know that money can't buy you happiness or fun, if what you pay for isn't what you call fun. Living frugal has always been my way.
My grandma taught me to sew, knit, crochet, and cook from scratch. My mom taught me to clean without spending money that was not around with no job, and my grandpa taught me to fish which is what we eat fresh caught all summer long. My dad taught me car maintenance, so paying for oil changes never happened in our family which is what I teach my children, and DH was raised the same way I was raised frugally, so we teach that to our children. This is how we live frugally.
By Tanya J. from MN
I am a single mother of two kids. The income I have comes from what little I make from my full time job, my job working in my church's nursery on Sundays, and Child Support for my oldest. I am constantly learning new ways to stretch my meager dollars. This is what I do to stretch what I have:
As odd as it may seem, just the act of writing down a budget can have an adverse or possibly even reverse affect on your attempt to save money. Have you ever decided to go on a diet and immediately began craving something sweet? Or, have you made a personal commitment to reduce your shopping adventures only to suddenly find some really good, seemingly irresistible bargains? A written budget can affect you in the same way. Once you write down your reduced spending plan, you may begin to feel a sense of deprivation that can lead to rebellion.
Possibly, the key to living on less without feeling deprived or rebelling against budget restraints, is to refrain from actually writing down a budget. Instead, focus on making simple, subtle lifestyle changes that will save you money so indiscreetly that you won't even notice you're living on a tighter budget. Strive to replace expensive habits and activities with new, less expensive or possibly free options and activities.
One of the first things people are encouraged to cut from their budget is regular visits to a coffee shop. Reducing your daily coffee shop adventures to once a week or once a month is a good starting point. The way you fill the void on the days you don't stop by for morning coffee is a key factor in how determining how dedicated you remain to your commitment to change. You could replace your regular visit to the coffee shop with an invigorating walk or an indoor exercise routine You could spend that extra time with your spouse, children or pet. You could even enjoy the luxury of sleeping a little later on the mornings you don't plan to stop for coffee.. This method of change can be applied to numerous other habits that, if broken, could be helpful in reducing your monthly expenses.
Eating out is expensive. A lifestyle change in this area can certainly ease a strained budget. Experiment with new recipes at home, make meal preparation a family event, decorate your table to make meal time special, or do whatever you can to make meals interesting at home. Develop frugal grocery shopping skills to further reduce your expenses. Instead of dining at a restaurant, enjoy a picnic at a park or possibly in your backyard. Make bag lunches and meals at home part of your regular lifestyle and eating out an infrequent treat.
If you frequently find yourself wandering through the mall in your spare time, change your routine. Instead, go on a nature walk. There is no temptation to spend money while walking in nature like there is when passing by store displays in a mall. If you are a spontaneous buyer, changing that habit alone will have a positive affect on your budget. Become a more patient shopper who waits for bargains and is not lured into spending by eye catching store displays.
Chances are, you will spend less if you pay cash for your purchases. You can develop a savings plan by never paying with exact change. At the end of the day, put your extra change in a "reward jar" Loose change adds up more quickly than you would think.
When choosing entertainment options, look for local events that are free or inexpensive. Concerts in the park, art exhibits, and free education classes could open up new doors of interests for you and your family. When you read about or hear other people discussing money saving changes they've made, take time to see if those changes could be a benefit to you. If you pick up on ideas as time goes by and implement small changes, the end result will make a large impact on your overall budget.
Something as simple as clearing clutter from your home and developing good organizational skills can save you money. You won't find yourself buying duplicate items simply because something got misplaced among the chaos. Make a conscious effort to learn the art of reusing, reinventing, and re-purposing items to reduce spending and avoid adding unnecessary stuff to your home and your life. "Stuff" is often a budget buster that can be avoided.
By VeronicaHB from Asheboro, NC
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Here are questions related to Living on a Tight Budget.
Hello, I am the mother of three teenagers, well one of them is only twelve, but my oldest, at only 16 is 6'5 and 230 lbs, and his dad is just as big. My problem is, although we both work, we have a very tight food budget, and I just can't seem to make it to the next payday with our food supplies. I want to cook healthy, I do frozen burritos from time to time, but that just doesn't do it. Any ideas how I can better stretch our food budget while not feeding them junk?
As one of the other readers suggested, serve water(or decaf tea/coffee) to drink with meals instead of milk or soda. Despite what the dairy industry is pushing, humans over the age of 2 or so do not need to drink milk. It is not actually a very healthy choice; it is mostly carbohydrates & contains cholesterol. I buy milk only when I know that I will need it as an ingredient for cooking. Plan your weekly menus before going grocery shopping. Some people find it helpful to set aside an entire day (such as Saturday or Sunday) for cooking a week's worth of food, then freezing/refrigerating it.
For all of you very frugal TF readers out there, I have a big dilemma. I am trying to help someone out with and was wondering if you could guide me. Is it possible to live on $1000 per month with a mortgage payment of $800 a month which includes the taxes? I am asking for a family of two, a parent and a 22 yr. old college student. The student's schooling costs are covered and he works part time for his expenses. The location is upstate NY which I mention because I know cost of living varies. Of course in this location there will be heating costs in the winter, but I know there is assistance available for that. Thank you for any advice you can give.
Another cost that can be reduced greatly is by going to their local food banks for assistance. They should call first to find out the hours they are open and what sort of ID and proof of address, if any, are required. Where I live you must bring a recent utility bill and a state ID that shows the same address. The hours open are limited.
I am trying to help out a friend with big financial problems due to poor choices over many years. My question to all of you successful TF folks is, is it possible to manage on the income she has coming in and get this nightmare turned around?
She is a 60 yr. old woman in poor physical health who had been unable to find employment for 4 years. She has no resources to fall back on. She is no longer eligible for unemployment benefits as they have been exhausted. After hundreds of job applications she finally was hired, but it is a very physical job and it is questionable just how long she can make it there. The pay is low.
Her income is very close to $1,000 a month, but her mortgage payment is $800 a month, plus her utilities. She is 2 months behind on the mortgage. The bank is threatening to foreclose as this has been a long and winding road they've been on before. She lives with her 22 year old son for the summer, but he leaves to go away again for college in fall. Fortunately he has been able to work out his finances for school, but he does need to save some money over the summer here. Is it possible to be frugal enough to make it on that much money? The geographic location is upstate New York as I know locations do make a difference.
Absolutely get rid of the house, she may be able for Social Security Disability, be sure and check that out. On getting a roommate, be very cautious. I'm 67 and I'm not sure I'd want a roommate, I'd rather have senior housing. My mother-in-law's income is around $1300 a month and she was able to get senior housing for less than $300 a month - this is in southwest Missouri. I don't know what kind of bills she has, if she has credit cards, she might be able to declare bankruptcy. Check with Legal Aid (free attorneys).
Kudos to the son for taking care of his college, but at 22 he should be graduated or almost ready to graduate. If he's still living with his mom, he should contribute to the household expenses while he's there.
Get rid of cable and internet services - read, go to the library for books and magazines.
Garage sales, flea markets and consignment shops are great for selling and buying clothing, books, etc.
Consolidate trips to town. I live in a tiny town 30 miles from a major town and I'd love to go every day. I have my trips down to once a week and now that my husband is very ill, my trips are down to when we have doctor visits in that town. It's not especially fun, but I view it as a temporary situation.
This shall pass.
How is it that I am only making $1185.00 per month, for I am on disability and I always come up short? I have done everything I can think of to budget my money to make it possible to have a few dollars to put aside for an emergency.
By Lesa from Houston, TX
By Joan B.07/13/2011
I am living off $750.00 a month total, retirement Social Security. I get rental assistance for my apartment, the rent includes heat, water, sewer, garbage, cable TV (as a thank you for renting from them). I also get food stamps. Check with your Department of Social Services and see if you qualify for things like food stamps, etc. If a person qualifies for rent assistance I urge them to sell their house and move into a rental. However, most locations have a real long waiting list for rent assistance. Here the waiting time is about 2-3 years. Here is also HUD apartments that are low income. Check into these things. I also gave up my car about 14 years ago. For me it is more economical to take a cab or being I have mobility problems I also ride a paratransit bus. The thing when using cabs and other public transportation is you have to plan ahead and limit your trips. Doing this is cheaper than running your own car. When you have a car you have to figure payments, insurance, oil changes, gas, tires, and all other maintenance items that might come up unexpectedly.
How can I feed and clean a family of 5 for $200 biweekly?
Laurie from Belle River, Ontario
By Tamala Tolson05/07/2012
I go to a food bank when I running low on food. And you can come back as much as you want for bread and there is no limit on the bread and bread only.
Here's my situation; I am currently unemployed and can't seem to find a job. My husband only brings home 1600.00 s month after everything is taken out of his check. We have one child. We filed bankruptcy like 2 years ago (the payment plan one) so all our loans are being paid through that, except the house. Anyways, I need help with money management. I need a budget. Is there a dependable budget online I could use to survive on 1600.00 a month?
By Teresa Tart01/08/2011
I agree with KansasCindy you do not have to give up cable, cell phone, or other extras and be miserable. Get a composition book and write down all your bills and beside each one put how much you pay. Power bill you may have to estimate. Like KansasCindy see if your cell phone, cable company can give you a better deal right now. Also you said you have one child maybe you could find another child to keep and bring in some extra money. Children are not too picky and will eat most anything. If you keep a baby then the parent should provide the food and milk! Where I live a person can get $100.00 a week for one child. More if it is an infant. Check around and see what people are charging in your area. Good Luck and I know what you are going through. I only work 3 hours a day!
I like many other people are struggling financially. but unlike many others I have been in this boat for well over 5 years. I pay for my own health insurance. I own my car and condo outright. But I am living paycheck to paycheck hoping the next check will be enough and it never is. I keep having to borrow from my savings account. My good friend is helping me with telling me which bills to pay and when as I don't have the organizational ability to do that.
She has been doing that for 2 years and I haven't learned anything from her about how to do it myself. I don't go to movies, beauty salons, or other fun things. I see many people on relief and assistance and they have such nice clothing, have their hair done and here I am living honestly on only the money I earn and money a friend will give me every now and again. I can't get by and am having a really hard time. What else can I do?
Sandy from Baltimore, MD
By Mary (Guest Post)02/24/2009
Just a few things that have worked for me...if you are a person that can't say no to your kids at a store (you know who you are), leave them at home. They will think that you are mean either way, at least save money while at it. Or you could bring them back something, your choice and price range. I work in retail and see mothers drop $10-$20 every shopping trip just to keep their kids quiet. Good for the economy but unhealthy for the children. It is possible that after a few times being left at home, after you explain to them why they can't go, they may reconsider their behavior. Don't carry ANY plactic forms of payment with you. Use cash. You won't have nearly as many bags to carry in, LOL, as you will not buy things that you can't afford and don't need anyway. Don't leave any money in your checking account after paying bills. It disappears as if by magic. Before you know it the money you were going to withdraw for groceries is gone. Do your shopping ASAP, use the money for what it was intended. If you are fortunate enough to have a little left over after bills, get it out of easy reach. Put it in a separate account that you can only access by car. Most people won't bother to go get money for something trivial, especially if it's for somebody else.
Where can I find help on food for the month, on a $350.00 budget? It's for my fiance and myself.
By Duane from Pine City, MN
By Chelsea Asher06/20/2010
I absolutely love the 10 for 10 sales! Stores use to be strict about them. You use to have to get exact things and the sale only came around every once in a while. Now, stores do it a couple of times of month. Check around for ads near you that have these deals. I will warn you that a lot of the food on the 10 for 10 isn't considered "healthy," but if you're not too picky they're great. Also, I only use coupons if there's a sale on the item. If there isn't a sale, the coupon doesn't take much off (even with double/triple coupon). Check the ads again and then cut your coupons.
I would like to see information about being frugal and single at the same time. I have a part-time job and live alone. I have to grocery shop at a food bank. I need easy and frugal recipes for 1. How to make ends meet better and how to stretch the dollar. All the frugal sites address people living on 2 full time salaries.
Easy frugal recipe for one:
Our Daily Bread
1 cup water
1 teaspoon salt
3 cups bread flour
1 teaspoon yeast
While kneading dough can be relaxing when one has time and strength, I use a small bread machine.
Place ingredients in the order given.
Program for dough.
when ready, in about two hours, remove from mixing canister, shape, place in greased -I use PAM- bread mold or pyrex ovenproof bowl.
Place in OFF oven.
When dough has doubled in size, turn oven to high -450 degrees- and bake till fragant and golden -about 30 minutes.
Turn oven OFF.
Remove bread from oven and unmold carefully -it will be very HOT-
Cool bread slowly by returning unmolded bread to OFF oven.
I am looking for tips for senior citizens who live on limited income.
Regarding food shopping on senior discount days, some markets offer discounts if you bring your own shopping bags too. So keep the bags you get at the store the first time you shop and use them whenever you shop again.