How to Save Money on Low Income (10 Practical Tips That Actually Work)

Last Updated December 19, 2024 by Davina Kelly

Your paycheck hits your account—and before you know it, it’s gone. Bills, groceries, rent—it all adds up so quickly that saving seems impossible. But learning how to save money on low income can completely change that narrative.

Living on a low income can be overwhelming, especially when you’re struggling to save. But here’s the truth: You can save money, even on a tight budget. It’s about making small, consistent changes and being intentional with every dollar.

Trust me, I’ve been in your shoes. By focusing on the biggest areas of my budget—housing, transportation, and food—I was able to carve out savings, even when it felt like there was no wiggle room. 

In this post, I’m going to share practical, actionable tips to help you start saving—even when your budget feels stretched. 

And the great thing is, once you see that first bit of progress, the momentum builds, and saving becomes easier and more motivating.

Now, let’s get into these tips on how to save money on low income. 

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How to Save Money on Low Income:

1. Stay in Your Financial Lane

Yes, you read that right. Remember that phrase “Trying to keep up with the Joneses?” 

The point here is simple: stop spending money you don’t have on things you don’t need. 

Thanks to social media more and more people are falling into this trap without realising it. But it needs to stop if you want to save money. 

Many people struggle to save not because they don’t want to, but because they’re spending beyond their means.

Whether it’s going out for expensive dinners, splurging on clothes or indulging in other luxuries, all these unnecessary expenses add up quickly.

If you really want to know how to save money on low income, start by avoiding situations where you’re templated to spend.

It’s easy to want to keep up with friends or partake in fun activities, but those habits will keep you stuck living paycheck-to-paycheck.

Stay home more often, find cheap hobbies or free activities and start getting comfortable with saying no to spending money you don’t have. 

2. Treat Saving Like a Bill

One of the biggest challenges for people trying to save money is simply making it a priority. 

Here is a mindset shift that can work wonders in this area: treat your savings like a non-negotiable bill. Just as you have to pay rent or any utilities every month, commit to paying yourself first. 

When you prioritise saving, it becomes something you have to do. Whether you can only afford to save $50 or $100 a month, the key is consistency. 

Decide on an amount that works for your budget and make it automatic – set up a transfer to a savings account right after you get paid.

This way, you’re ensuring that you’re always building up your savings, no matter how tight your income may be. 

3. Make Your Spending Predictable

One of the most effective ways to manage your finances is to make your spending predictable. When your expenses are all over the place, it’s difficult to know where your money is going and how much you can afford to save. 

To gain control over your spending, track your expenses for at least three months. Record every dollar you spend – from groceries and rent to that $5 Starbucks – and look for patterns.

After a few months, you’ll notice where your spending fluctuates and, if so why. 

For example, if you spend $3,000 in July and $4,000 in August, ask yourself why. Did you eat out more? Did you make an impulse purchase?

The goal is to create consistency in your spending so that you can better predict how much you’ll spend each month. 

The easiest way to make your spending predictable is by creating a budget. A budget will give your money direction instead of spending it all and wondering where it went.

Plus, it will help you save more. 

Once your spending is predictable, it becomes much easier to set aside money for savings.

You can grab my FREE printable budget and expense tracker below to start taking control of your money.

4. Analyse and Cut Entertainment Expenses

A common area where people tend to overspend is entertainment. From subscription services to movie nights and dining out, entertainment costs can add up fast. 

To start cutting back, list every entertainment expense you have – such as Netflix, Disney+, YouTube Premium, cable TV and any other subscriptions you might be paying for. 

Once you have the full list in front of you, decide which ones you truly value and actually use regularly and cut the rest. 

It’s not uncommon for people to pay for services they no longer use or need. Maybe you subscribed to a streaming service just to watch one show or you signed up for a premium account that you don’t even use. It’s easy to forget. 

Cancel those subscriptions and redirect that money toward your savings. This simple step can save you $10, $20 or even $50 per month!

5. Find Cheaper Alternatives for Service Expenses

Monthly service expenses like your internet, phone bill, gym membership or Amazon Prime can also take up a big chunk of your budget. But with a little research, you can find cheaper alternatives. 

For example, you can lower your internet bill by switching to a basic plan if you don’t need super-fast speeds. 

On your phone bill, you can save a lot by switching to a budget provider or a sim-only plan. I made this change myself a few years ago which brought my bill down from $65 to $15 a month. That’s a $600 annual saving I now put directly toward my savings. 

Do you have a gym membership? If you’re not using it regularly, consider cancelling it and working out at home. You can find great workouts for free on YouTube or opt for free exercises like walking or running. 

Take some time to write down all your service expenses and research alternatives. Uswitch.com is a great website you can use to compare prices. I use it all the time and have found great deals. 

This might seem tedious, but trust me a little effort can lead to big savings, which you can funnel directly into your savings. 

6. Reduce Transportation Costs

Transportation is one of the largest expenses for most people. According to Bankrate, the average American spends over $15,000 a year on their car. From gas and insurance to maintenance and car payments, it all adds up. But there are ways to cut these costs.

Start by reviewing your bank statements to see how much you spend on transportation each month. Then, use apps like GasBuddy to find the cheapest gas in your area and shop around for lower car insurance rates. 

Or maybe consider trading in your car for a more affordable, fuel-efficient model. These small changes can lead to big savings.

If your car is costing you a fortune in maintenance, it may be time to upgrade to a more reliable vehicle. Yes, I know it will cost you more upfront, but it will help you save in the long run. 

By cutting down your transportation expenses, you can free up hundreds or even thousands of dollars a year that can go toward savings. 

7. Lower Your Food Costs

One of the best ways to save money on food is by planning your meals and cooking at home.

I know it’s tempting to order takeaways especially when you’re tired after a long day of work, but those purchases add up quickly. 

By planning your meals and sticking to a grocery list you can save a lot of money and avoid spending excess amounts on food. You’ll not only enjoy healthier meals but also keep more money in your pocket. Here’s how to make meal planning work for you:

Set Aside Time for Meal Planning: Dedicate a few minutes each week to plan your meals. Think about your schedule and pick recipes that suit your time and energy levels for each day. 

Planning takes effort but it will help avoid the urge to splurge on takeout when you’re tired or in a rush.

Create a Grocery List and Stick to It: Once you know what meals you’ll be making, write down every ingredient you’ll need. 

Having a clear grocery list helps you stay focused, prevents impulse purchases, and keeps you from overspending on items you don’t need. 

Plus, you’re less likely to waste food when you buy only what you need for planned meals.

Cook in Batches and Freeze Leftovers: Preparing meals in larger quantities not only saves you time during the week but also prevents you from reaching for convenience foods. Freeze portions of meals for quick, homemade “ready meals” that you can reheat on busy days.

Limit Takeout to Special Occasions: Rather than cutting out takeout completely, make it a treat for special occasions. When you do order in, you’ll enjoy it more because it feels like a reward rather than a quick fix for hunger.

Experiment with Budget-Friendly Recipes: There are countless delicious recipes that don’t break the bank. Check out my posts below for some inspo:

20 Tasty Extreme Budget Meals

20 Delicious Budget Lunch Ideas 

How to Meal Prep on a Budget & Save Money

By incorporating these strategies into your routine, you’ll not only enjoy nutritious and tasty meals but also keep more money in your pocket. Every small adjustment adds up, allowing you to eat well and save more money over time. 

Grab my FREE printable weekly meal planner below and start implementing these tips. 

8. Live The Way You Did Before Convenience

Do you remember the days before smartphones, food delivery apps and endless online shopping? If you were born before 1999, you probably do. Life was simpler and people didn’t have as many temptations to spend money at every turn. 

These days, it’s easy to get caught up in the convenience of modern life – ordering takeaways, shopping with one click or signing up for another subscription. 

But here’s the thing: convenience often comes at a price. To save more, try living like it’s 1999. Embrace simpler forms of entertainment, cook your meals at home and avoid the endless shopping traps that come with our digital age. 

When you strip away the excess, not only do you save money, but life becomes less stressful and more enjoyable. Focus on the basics and you’ll see your savings grow.

How to Save Money on Low Income – Bonus Tips

Avoid Debt Traps

When you’re living on a low income, it’s easy to fall into the trap of payday loans or rack up credit card debt to cover emergency expenses. 

But these loans come with super high interest rates and can quickly spiral into a cycle of debt. 

I know this from personal experience. I was stuck in payday loan debt for two years and it was awful. The interest piled up so quickly that I was stuck paying off loans every month.

If you can, avoid these loans at all costs!

Increase Your Income

Let’s be real – sometimes the best way to save more is to earn more. Easier said than done, I know! But there are side hustles out there that fit around your full-time job or other responsibilities. 

Here are some ideas:

• Freelancing: Sites like Fiverr and Upwork are great places to offer your skills. Whether you’re good at writing, graphic design, or social media management, you can use your existing skills to earn extra income. 
• Start a side hustle: You could sell items on Etsy, offer online tutoring, or even start dog-walking. Thanks to the gig economy there are plenty of side hustle options to choose from! Every extra dollar you earn can help you grow your emergency fund or tackle your debt faster.
• Complete online surveys: Completing surveys won’t make you tons of money, but you can bring in some extra cash during your downtime. 

Here are my favourite survey sites:

Survey Junkie – Millions of people use Survey Junkie to make extra money or get FREE gift cards. It’s free to join and super easy to use. 

InboxDollars – Earn virtual points by answering questions, shopping online, playing games and more. Get a FREE $5 welcome bonus when you sign up today. 

My Points – Earn cash or rewards by sharing your opinions. Complete surveys, watch videos, and more to rack up points. Plus, get a FREE $5 bonus just for signing up! 

Take Advantage of Free or Low-Cost Training and Resources

Sometimes increasing your income means investing in yourself. Upskilling or learning something new can open the door to better-paying opportunities:

Free Online Courses: Sites like Coursera, Skillshare, and even YouTube offer free courses on a wide range of topics. Whether you’re looking to improve your job skills or learn something completely new, these resources can help you boost your income potential.

Government programs: Many governments offer free or low-cost training programs for people looking to enter higher-paying fields. Look into what’s available in your area and see if you qualify.  

Build Up an Emergency Fund (Even if it Feels Impossible)

An emergency fund is your financial safety net. I know it can feel impossible to save for one when your income is already stretched, but even saving a small amount can make a huge difference. 

It’s your buffer for unexpected expenses and it can keep you from turning to high-interest credit cards or payday loans when emergencies strike.

You can set up an automatic transfer to your emergency fund, even if it’s just $5 a week. Over time that money adds up.

Another option is to try money-saving challenges. Some of them are especially good when learning how to save money on low income because you can even take part in a challenge to save $1 a day. 

The peace of mind that comes with knowing you have a cushion is invaluable, especially when living on a low income. 

Use Cashback and Coupon Apps

Cashback and coupon apps are a great way to save money on low income. Apps like Rakuten and TopCashback can help you get money back on purchases you’re already making.

Just don’t let these apps tempt you into buying things you don’t need. Use them strategically for items that are already on your list. 

Final Thoughts 

There you have it: practical, actionable tips on how to save money on low income. I know from personal experience that it can be overwhelming at first, but I also know that with a few smart strategies, you can start building up your savings. 

Focus on budgeting, cutting unnecessary costs, and increasing your income where possible. Start small, stay consistent and don’t forget to celebrate your wins along the way. 

I hope you have found this post helpful and now know how to save money on low income. Which tip will you implement? 

Other Posts You May Like:

How To Budget on Low Income (10 Simple Steps)

10 Fun Money Saving Challenges