If you’re living on a tight budget, you probably already know how difficult it is to make your money last until your next paycheck. It’s challenging to use your money effectively when you may not always have the funds to put toward your next rent payment, but there are some tactics you can use. This article will discuss ten tips for stretching your budget, even when money is scarce. If you are struggling to manage a tight budget and need some ways to conserve even more funds, keep reading for some essential pointers.
Figure Out Your Goals
Before you create a budget, you’ll need to understand your ultimate financial goals. For example, are you saving up for college, saving for a big trip, saving for retirement, or saving for a new baby? Where do you need to allocate your money, and where can you put money to save it effectively? Have a solid list of your goals before you start crafting your budget, as your individual goals will help you choose exactly where to allocate your money.
Customize Your Budget
You can find many different general budgets online as outlines for what your budget should look like. However, since budgets are truly specific to each person, you won’t be able to find a budget online that perfectly fits your needs. Instead, you should take inspiration from these budget outlines and take pieces of them to customize however you see fit. Add new sections or allocations if you need certain parts of your budget specified, and remove sections if they aren’t relevant to you (kids, college savings, etc.). There are also some excellent budgeting apps out there if you prefer to keep it digital.
Pick up a Side Hustle
Picking up a side hustle is one of the best ways to stretch your tight budget, as it will actually give you a little breathing room and more money to work with. Side hustles can be anything from freelance writing to delivering groceries, but one of the best side gigs is taking paid online surveys for money.
Websites like Branded Surveys allow you to make a free profile and take surveys for cash. You’ll connect with researchers, brands, and institutions that want to pay you for your opinions and reviews. Branded Surveys protects your data with high levels of website encryption and only has a payout minimum of $5, so you don’t need to do many surveys to bank some cash. Most surveys pay between $.50 and $2 per survey. And you can easily chip away at these 24 hours a day, 365 days a year! You can get paid to take surveys from your phone anywhere (while waiting at the doctor’s office, during a bus trip to work, etc.).
Use the Past to Estimate Your Budget and Expenses
Generally, it’s good practice to use your past budget and spending history to determine your future expenses. Obviously, it’s good to carry your budget over as much as possible from month to month. However, when going through something like a major move, promotion, or life change, it can be challenging to determine what your future expenses will look like. Nevertheless, using your past budget and typical expenses can give you a good starting point for how much money you should be spending and saving and where it should go.
Budget for Both the Month and Each Paycheck
Budgeting for the month is the obvious choice for many. Rent, utilities, car payments, and loan payments are due once a month, so these expenses are clearly ones you must budget for. However, if you get paid bi-weekly or every week, it’s important to also budget for each of those paychecks instead of just for the month. For example, how much of each paycheck is going toward rent, groceries, and utilities? Splitting up expenses in this way can make it easier to budget toward the end and beginning of the month.
Remember the Goal: Spend Less
This might seem like an obvious tip, but remember that the ultimate goal of budgeting is to spend less money! When you budget appropriately, it might feel like you have a lot of money “left over” that’s spendable. In reality, this is money you should allocate and save for other things you need funds for (a trip, college, etc.). Don’t be tempted to spend money you are supposed to be saving. Sticking to your budget will help you spend less money overall.
Use the 30-Day Rule
The 30-day rule is an excellent way to budget while still paying attention to things you might want or need. The premise is simple: if you want to buy something that’s outside your budget or what you’ve already allocated, wait 30 days. After those 30 days, you can reevaluate your current budget and decide whether you a) still want the item and b) whether your current budget will allow it. The 30-day rule also allows you to set some money aside over the following month if you choose to purchase the item. Often, you’ll find at the end of 30 days you don’t even want or need whatever it is you had your eye on.
Many people don’t know this, but you can often negotiate your bills, so you are making smaller payments each month. You can do this by calling all of your providers (phone, electric, water) and negotiating over the phone, or you can use apps designed explicitly for negotiating, like Trim or Empower. Ideally, if you negotiate your bills a couple of times a year, you can cut down on your overall expenses.
Have an Income-Sinking Fund
An income-sinking fund is a savings account that you put a little bit of money into each month in case something goes wrong or you end up making less money than expected. Some people make more money at certain times of the year, so it’s wise to take the difference between your average income and those high-earning months and sink it into a savings account. You can pull money out of this account to supplement your budget during months when your income may not be as high.
Remember, Things Could Go Wrong
When you start working with a budget, it can be difficult to adjust at first. Especially for those who haven’t had a strict budget previously, moving to a more concrete budget can feel very restrictive. Therefore, you’ll need to accept that things could go wrong when you start implementing that new budget. You might go over budget, or something may be more expensive than you expected. The first few months may not pass without bumps in the road. This is okay! As you continue using your budget, you will learn what works.
Be Kind to Yourself
As we just mentioned, adjusting to a new budget can be tough. So it’s essential to be kind to yourself while implementing and sticking to a tight budget. Money is one of the most significant stressors in life, so you need to allow yourself some grace when making mistakes and figuring things out.