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Have you ever been hit with the realization that if you miss a few paychecks, your finances and perhaps your whole life might spiral out of control? Imagine your credit ruined, your home and car repossessed, and your family in poverty.

Yes, missing just a few paychecks has destroyed many lives, and yours is not immune to the carnage it can wreak — unless you do something differently: save money.

Financial independence depends on several factors. Prominent among those factors is the ability to save money. No matter how big or small your income is, if you’re unable to save some for the raining day, it will be nearly impossible for you to attain financial security.

Most people tend to live in a bubble when it comes to their finances. They see other people losing their jobs but never imagine that it could happen to them. They tend to think that those paychecks will keep raining in. Well, here’s a surprise for you — it wouldn’t. That’s why you need to put some money aside for the raining day.

According to the Federal Reserve Report on the Economic Well-Being of U.S. Households, many American adults are financially vulnerable. They would have difficulty handling an emergency expense of $400. Of the people surveyed, 27% will have to borrow or sell something to raise $400, and 12% will have no means of getting the money at all.

If you fall anywhere within the statistics cited above, or if you’d have to use your credit card to cover a $400 emergency expense, then this article is for you. Regardless of how small your income is, saving money is possible, and here’s how:

Ways to save money on a tight budget. Have a goal
Start with a goal

Start With A Goal – How Much Do You Want To Save?

Having an established goal is crucial to saving successfully — even on a tight budget. Think of it as a guiding light — a lighthouse, if you will. It will help you to know and measure your progress.

To establish a goal, ask yourself the question, “how much do I want to save? Is it $200, $1,000, or $5,000”? Whatever the target amount is, it is your goal. Now you have to do everything to achieve that goal.

Set A Specific Time Frame To Achieve Your Savings Goal

Goals need to be bound by specific time frames. Do you want to save $1000 within six months, one year, or two years?

Setting your goals and having a specified time frame for achieving them is a good strategy because it adds a sense of urgency to the process.

For instance, if you want to save $1,000, but don’t have a deadline for doing so, it is likely that you wouldn’t achieve your goal because there’s no motivation or sense of urgency attached to it.

Now that you understand the importance of having a goal and setting a timeframe to achieve it, let’s go and save some money.

1. Save Automatically

Saving money is not easy, especially when you don’t have enough of it. However, to make the process painless and straightforward, you should set up your bank account in a way that money gets automatically transferred from your checking account into your savings account.

Once you set the system up — a process that may take less than five minutes — your bank will handle everything else automatically.

If you plan on saving $50 or $200 every paycheck, your bank will transfer that amount from your checking account to your savings account.

Tip for success: To succeed with this method, let your checking account and your savings account be with different banks. For example, if your checking account is with Bank of America, let your savings account be with Axos Bank or CIT Bank. This way, you wouldn’t have easy access to squander the money in your savings account.

There are other tips like putting a restriction on withdrawals from your savings account until a specific date or until the money reaches a certain amount.

Related:

2. Develop A Budget

One way to save money is to control your spending. A budget is a useful tool for controlling spending. A budget lets you know how much to allot for a particular expense category, and if you are going by your budget, you will constrain your expenses to remain within the confines of your budget.

If you can’t develop a budget spreadsheet yourself, there are practical budgeting tools and Softwares out there that you can use. Some of the best personal budgeting tools are:

3. Use A Shopping List

Using a shopping list to shop is an excellent strategy for controlling costs and saving money.

Most people who go grocery shopping without a shopping list end up buying other things they didn’t plan to buy.

When I go grocery shopping without a list, I almost always end up spending over 1.5 times the amount I pay when I use a list.

Tips For Succeeding: Have a master list of things you always get when you go shopping. Place that list on the refrigerator door, and also snap a picture of it. You can use the image as a guide whenever you go shopping.

You can also use a shopping service like Shipt. The benefit of using a service like Shipt is two-fold: spending control and reprieve from shopping yourself.

4. Buy Generic Or Store Brands

Sometimes the difference in quality between a “premium” and the store brand is non-existent. For example, the difference in cereal from one brand to another may be minuscule. However, customers pay a premium for one label over the other because manufacturers are good at marketing.

Store and generic brands can be just as good for sometimes half the price of the “premium” brands. If you are serious about saving money, consider buying the less expensive store and generic brands.

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5. Avoid Using Appliances During Peak Hours

Did you know that there are peak hours for electricity use, and utility companies charge more during those peak hours?

PG & E, one of the largest utility companies in California, has a “Time-Of-Use Rate Plan.” What this means is that the company charges its customers based on the time of day they use their appliances.

The rate during the peak time for PG&E is almost twice as much as the rate during off-peak time. You stand to save money on the use of your electrical and electronic devices if you use them less during peak time. There are some appliances you cannot avoid using. However, that shouldn’t prevent you from finding others you can save on.

For example, you cannot turn off your refrigerator during peak hours, but you can put off using the washer during peak hours.

If you live in other parts of the country, call your utility company or visit their website to find out what their peak hours are. Doing this will save you money on utility bills.

6. Buy In Bulk – To Save Money On A Tight Budget

Buying in bulk is a good strategy for saving money. Brands like Costco and Sam’s Club offer excellent value for money when you buy in bulk.

However, buying in bulk shouldn’t be limited to big-name discount outlets. You can buy in bulk at your local grocery store as well. Most stores sell packs of items for much less than they sell individual items. It pays to do some research before you make your purchase.

7. Ask For Deals And Promotions

“Do you have any deals or promotions going on right now?” That’s a simple question that could save you a ton of money.

Many times, stores have promotions that are unpublicized, and if you ask, you may get to know about those promotions.

Related:

8. Shop Around Before You Buy

Comparing prices is one of the oldest shopping strategies. You will be surprised to know that something sold for $100 in one location may be sold for $150 in the next.

I remember buying a family-size pack of Oreos for $2.78 in one store and then seeing the same item sold for $3.98 in another store. That’s more than a 30% price increase.

It is a huge deal to save 30% on your grocery bill every time you go shopping.

9. Audit Your Recurring Monthly Payments

Do you have subscriptions that you don’t use? Cutting those subscriptions will be a great way to save money. Are there digital magazines, music, videos, and other subscriptions you’re still holding? Consider canceling those subscriptions to save money.

Apps like Truebill and Trim can help you cancel unwanted subscriptions. All you have to do is sign up and make use of the services.

10. Scrutinize All Your Bills And Ask For Deals, Discounts Or Promotions

Get a list of all your bills and see if you can negotiate deals and discounts from your creditors.

I remember once receiving a very high AT&T bill. I immediately called customer service and complained about the bill — they were charging me for data overages and other things.

The customer services lady generously offered to cancel all those charges. I ended up saving almost $120. Now imagine if I just went ahead and paid those bills. I would have lost $120 that I could be spending on other things.

Trim and Truebill can help negotiate bills on your behalf as well.

Related:

Bottom Line – How To Save Money On A Tight Budget

Saving money has to be a conscious choice. It is a deliberate decision to alter the way you live now so that you can live better in the future. Anybody can be a saver, no matter the income. It all depends on your resolve and determination.

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A convenient online bank that offers a full-service account.
No minimum balance requirements. No maintenance fees. Interest compounded daily.

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No minimum balance requirements. No maintenance fees. Interest compounded daily.

Minimum $50 to open an account. Free ATM card 

An environmentally friendly bank that pays up to 1% APY.
No minimum balance requirements. No maintenance fees.
Minimum $10 to open an account. Free ATM card

Author

Harold is a California-based personal finance writer and the creator of Wholesome Wallet. He loves to write about investing, and ways to make and save money. You can find his work on Benzinga, Seeking Alpha, Medium, and other places on the internet. Harold also has degrees in Accounting and Economics.