The goal for many folks is to build wealth and save enough money for certain life goals, such as traveling, buying that dream home or car, or achieving a comfortable retirement. But how are these possible when one is barely surviving financially? CNN notes that 25 million households in the United States are living paycheck to paycheck, and money could be tight. Here are ways to still save money and reach financial targets on a low income.
Cut down on major expenses
Go beyond cutting back on small expenses. Focus on the bigger ones for a more pronounced impact on one’s budget. Housing costs, for instance, can be dramatically slashed by downsizing to a smaller home or living with roommates or friends. This can have a greater effect than, say, the usual tricks such as cooking meals at home.
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Get and stay out of debt
Get a good picture of your current financial situation by listing down existing debt and their respective amounts, terms, and monthly payments. Make more than the minimum payments, as paying debt longer means delaying financial freedom due to ongoing interest. Be prudent in using credit cards.
Keep entertainment low-cost yet still fun
Having fun does not mean spending a fortune. Host potluck dinners at home instead of eating out. Hold movie nights at home and take advantage of free activities such as hiking or free city concerts. Use coupons or discounted deals for monthly outings and dates.
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Buy only what’s necessary
Don’t upgrade your smartphone or gadgets when not absolutely necessary. Forego a shiny new purchase if it merely speaks to one’s temporary wants.
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