How to Save Money On a Low Income: Top Tips From a Finder Expert

April 6, 2022
save money on low income

You can absolutely save money with a low income, while also leading a healthy and active lifestyle.

The key to saving money, whatever your income may be, is to first create a personalised budget (based on your income and expenses), then look for ways to save. 

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4 steps to creating a personalised budget

  1. Note down your current expenses. How much are you spending on housing, utilities, food, entertainment, transport, healthcare and other expenses such as debt and loan repayments. Don’t try to guess this – refer to your recent bank statements and transaction history to ensure you’re not missing something. 
  2. Identify easy opportunities to save. You don’t have to go without, but there could be a few things you could easily cut down on. This could be a gym membership or streaming service you rarely use. If there’s something you can control, for instance, weeknight drinks, you could introduce a limit on how much you want to spend. That way you get to have your fun and save at the same time. 
  3. Plan. Build a budget and savings plan. Having a clear financial goal helps. A budget that will allow you to get there is the next step. You could introduce small tweaks to help you meet your goals.
  4. Divide your money into buckets. Now that you have a clear picture of what you’re working with and how much you can aim to save each month, split the money you earn into different accounts. Keep money aside for savings (and don’t touch it!), spending and bills and rent. As soon as you get your salary, break it up into chunks and divide it accordingly. That way, you’re meeting your commitments and keeping your money separate. 

6 tips to save and make your money work harder 

save money on low income
  1. Make your savings productive. Don’t let it just sit there. There are a number of things you can do to increase passive income. One option is to open a high interest savings account and earn bonus interest on your balance when you meet the account conditions each month. Or if you’re looking for a bit more of a return, Finder Earn, available within the free Finder app, offers a 4.01% p.a. return on deposits of up to $50,000.
  2. Compare, switch and save. Are you spending too much on utilities? What about your health insurance or mobile phone plan? You may be able to save if you compare your options and switch to cheaper providers.
  3. Shop smarter. Supermarkets may be convenient, but they can also be more costly, especially for fresh produce. Shop around for cheaper options, such as a local farmers’ market. If you have a backyard, you could also consider growing herbs and leafy vegetables, which are typically more expensive to buy. Aim to buy products with a long shelf life in bulk such as rice, pasta, lentils and flour which store well. Going to thrift stores can also help with the cost of clothing and even furniture, as can sites like Facebook Marketplace and Gumtree. 
  4. Prep meals at home. Eating out is costly, and so is that cup of coffee. You can easily save money by cooking extra at dinner time and taking leftovers for lunch to work. Invest in a thermos or keep cup and try to make your coffee or tea at home. 
  5. Look for low-cost or free activities. You don’t have to cut back on fun, but there may be cheaper or free options. Look for cheaper movie and theatre tickets (some cinemas will have a discount night, such as cheap Tuesday). Museums, art galleries, parks and botanical gardens are also generally free, allowing you to soak in culture and nature without impacting your wallet.   
  6. Tackle any debt you have. If you have any ongoing debt, like credit card debt, work on paying it off as a priority. Credit cards can be used as an effective tool, but if you’re not meeting your repayments the interest charges are very costly and impact your ability to save. 

A big part of saving money successfully is changing your spending habits and making sure you stick to your budget. While this could feel a bit challenging to start with, it’ll get easier the longer you do it and the savings will make it all worth it. 

save money on low income

As your income increases you can adjust your budget, so you’re saving more, not spending more, as your income goes up. 

Need more financial advice? 

Browse our finance category. It’s chock full of advice from industry professionals and other hacks on how to save money with low income. And remember to download the Soho app for quicker browsing and property matching. It’s getting you into your dream home faster!

Alison Banney
Alison Banney is the banking and investments editor at Finder. She has written about finance for over 8 years, with her work featured on sites including Yahoo Finance, Money Magazine and Dynamic Business. She has previously worked at Westpac, and has written for several other major banks including Greater Bank, bcu and Gateway Credit Union. Alison has a Bachelor of Communications from Newcastle University, with a double major in Journalism and Public Relations. She has ASIC RG146 compliance certificates for Financial Advice, Securities and Managed Investments and Superannuation. Outside of Finder, you’ll likely find her somewhere near the ocean.
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