14 Ways To Save Money On a Tight Budget

Are there any ways to save money on a tight budget?! Yes, indeed! In this post, you won’t just find a couple of ideas but 14 amazing strategies to start growing that savings pot ASAP.

Saving money may seem like a challenge by itself, but saving on a budget? Is that even possible? Well, let me tell you: it is! 

As hard as it may seem, there’s always a way to increase your savings pot, and today we’ll be covering 14 different ways to save money on a tight budget. If not all of them, at least one (or hopefully a few) will be applicable to your current situation, so let’s get to them!

1. Start with the small things 

Living on a budget means there’s hardly anything to spare that you can allocate to your savings, so a good starting point is saving by not spending. To clear that up: 

  • Do you turn off your lights when you leave a room? Start doing it. 
  • Use your main appliances (washing machine, electric oven, water heater) during the off-peak hours for a cheaper electric bill. 
  • Turn off water when brushing your teeth, shaving or washing your hands.
  • Brew your coffee at home, and cook instead of buying take out  

The list could go on, so feel free to add your own examples. While you won’t be actively adding coins to your piggy bank with these measures, you’ll be spending less and gaining the difference. At the end of the month, you could calculate how much you’ve saved and allocate it to your savings account. 

2. Refinance your Mortgage

Owning your house is the ultimate dream of many money-savers, so if you own yours that’s already a hit! However, mortgages can be money-consuming. How to save money on a budget and with mortgage payments coming your way, then?

Refinancing your mortgage! It can be a great way of saving immediate money on your monthly payments, but also in the long run as you pay less interest fees. It can also shorten the term of the mortgage, so it’s beneficial on all ends. 

Refinancing this kind of loan is not, however, for everyone, so you should look into your payment plan and find out if refinancing would save you money rather than cost you more. This will depend on how long you have left to pay it off, refinancing fees or if you’re planning on moving out of your house. 

If refinancing your mortgage makes sense to your situation, you could be saving quite a bit of money on a monthly basis and in the long run. This could also apply to student loans or car payments

3. Budget Your Savings

If savings are not included in your original budget, you should budget again. There are many ways you can do so, but some of the most common are:

  • Use the 30-30-30-10 budget rule, where 30% of your income goes to housing, 30% goes to needs (groceries, utility bills, health insurance, etc.), 30% goes to goals (for example, paying off debt or saving for a house), and 10% goes to wants (anything you’d like for your pleasure such as meals out, concert tickets, etc.).
  • Use the 50/30/20 technique, in which you use 50 percent of your income for essential expenses, 30 percent for extra expenses, entertainment and wants, and the remaining 20 percent for savings. If you need more than half your income for essentials and don’t have that much to spare and save…
  • Figure out how much you can actually save, and only budget the remaining amount. If you don’t count that money when budgeting, you’ll be able to save a percentage on a monthly basis. 

4. Automate your Savings 

Following the previous tip, once you know how much you can allocate to savings, open a savings account and automate it; you won’t get tempted to use that money if it’s not in your hands! 

See if your employers can deposit your chosen amount directly on that account, or transfer it yourself immediately after getting paid. 

5. Make a grocery shopping list (and stick to it!)

While grocery shopping may seem like an essential expense (and it is), tons of unnecessary items (that sitting on the shelf seem completely indispensable) end up in your shopping cart all the time.

That’s money being spent on needless stuff and that could be helping your savings account grow faster (and bigger!).

The solution is very easy: make a careful list of what you need to buy before going to the store, and stick to it no matter what! This is one of the greatest everyday ways to save money, and it will help your finances big time.

A good extra tip is buying in bulk the non-perishable items at the beginning of the month, and limiting your grocery trips to getting fresh produce and goods.  

6. Track your Expenses

Learning how to save money on a tight budget is a process, and it will require you to track your expenses – which you probably already do if you live on a budget! If you don’t, however, I recommend you do it at least for a couple of months to find out exactly where every coin is going.

Tracking your everyday expenses (and doing a monthly budget review as a bonus) can help you realize that you’re spending too much in certain areas of your life, have subscriptions to online platforms or streaming devices you don’t really use, or bought take-out food more times that you thought you had.   

Knowing exactly how much and where your money is going is one of the key elements to increase your savings. 

7. Find Free Events 

Social life is an important part of everyone’s life, however, it can also be one of the most expensive. While you shouldn’t give up your friends’ weekly meetings, there are tons of options to make them more affordable – and plenty of fun things to do with no money.

Instead of paying for movie tickets every other weekend, or always dining out, try to find free events that are happening near you. Every place hosts free concerts, art shows or sports events every now and then, and you could benefit from them while still having a fantastic time with your friends!

Granted, you may spend some money on food or a drink at a concert or fair (or you could eat before going to tighten your budget!), but you’ll have spared the entrance fee and probably won’t be spending as much as you would on a restaurant dinner. 

Local museums, art galleries and attractions usually have a weekly or monthly free-entrance day; benefit from those as well!  

8. Ditch Your Expensive Habits 

I’m sorry, ‘cause I know you won’t like this point immediately, but not sorry. Quitting your expensive habits (some of which may even be bad for you) is not only a good money saving tip – it’s the best. It will make the dream of having a fat savings pot a reality, even if it’s the only lifestyle change you make.

Can’t think of any? Let’s start with the must-quit habit of all times: smoking. If it’s not your habit, good for you! If it is, smoking is mind-blowingly expensive, and even more harmful for your health, so you’ll be doing yourself an overall favor by ditching it completely

Drinking yourself to death at the bar is also unhealthy for the liver and wallet; we already covered it, but dining out every night is also a death sentence to your savings goal. 

Need more examples? Buying brand items instead of regular ones (same exact product, different label that costs you thousands), throwing your perfectly good leftovers because you don’t repeat a meal (if you really don’t, cook smaller portions), getting your nails done at a salon or ignoring your credit card statements. You should also stop buying clothes every week – who needs all those clothes?

If you want to learn how to live frugally and save money, this point is non-negotiable.

9. Avoid Monthly Bank Fees

This cost may already be considered in your budget, but what if I told you you could take those fees out of your expenses list and into your savings account? 

Nowadays there are many banks that don’t charge fees and have very good rates, so there’s really no reason to be paying for your bank account.

If you really like your bank and don’t want to switch to a different one, explain your situation to them, as keeping you as a client may be more important to them than charging you monthly fees, and they may waive them. 

If they don’t, however, you should seriously consider checking out other banks and making the change; you’ll end up with an additional monthly sum that’s going to be redirected to your savings pot. 

10. Apply the $5 trick 

How to be frugal and save money? Apply the 5$ trick! This trick is very simple, and you can turn it into a game or personal challenge to really commit to it. Basically, every time you receive a $5 bill, either as change, payment or miraculously finding it on the street, you put it aside in a secret savings stash. Sounds easy, right?

To make it work, though, you have to be truly dedicated to it; you don’t spend, no matter what, the $5 bill you just got. You’ll be impressed by how much money you manage to save at the end of the month or year only with 5-dollar bills. 

To give you an idea, let’s set an example. Let’s say you only come across a $5 bill every other week; that’s two bills a month and a total of $120 saved by the end of the year. Now, the realistic example: do you really only come across a five-dollar bill every two weeks? Thought so. Your end-of-the-year grand total could be spectacular! 

If 5 dollars seem like a lot at the moment, you can start with as little as $1; the key is to commit to it and get started! 

11. Learn to DIY

This point may be controversial, but bear with me for a second. DIY doesn’t necessarily mean you’ll suddenly fix and build from scratch everything in your life. While some people may be excited about that (gifted crafters, for instance) the goal is to teach you how to save extra money while still getting things done.

Learning how to fix a leaking faucet, paint the walls or change a tire can help you save tons of money in labor, maintenance and call-out fees. Emergency calls especially can cost you hundreds if not thousands of dollars over the years, so knowing how to maintain and fix even the most basic things around the house or your car can be a great way of saving money. This is one of the most impactful frugal living tips.

If you want to take it to the next level, learn how to cut or dye your hair to do it at home (or do your daughter’s or sister’s!), start mending your clothes or baking your dog’s treats.

You could discover a hidden talent or get a new hobby, all the while saving precious pennies (or $5 bills!) that could find their way to your piggy bank.

12. Save on Rent 

Living downtown may seem vital, especially for young people or those with FOMO syndrome. And while it’s true that living in the city center has its advantages, it also comes at a high, high cost. Not only rent is incredibly more expensive than in the suburbs, everything else is: from subway fare to supermarket items, taxes and entertainment. 

If you work remotely, then the primary obstacle for moving to the suburbs is eliminated. Even if your job is downtown, most cities have good transportation and while it may prove to be a bit of a hassle in the beginning, not only will you be saving money big time, but you may also be able to afford a better place or enjoy little luxuries now and again for much less. 

13. Organize Swap Meets

Frugal ideas to save money include organizing swap meets with friends, family or even neighbors! We all need some specific items at times, and have a few pieces of clothing or kitchen utilities that we no longer use.

So what better way of getting that new pair of boots or golden earrings than by swapping them for an electric jar that’s gathering dust at the back of the shelf? 

Of course, items should be in good shape, and you could even agree on certain conditions before the swap meet. At the end of the day you’ll have a new acquisition for next to nothing. 

On a similar note, don’t go out shopping every time you have an event. New clothes are expensive, you end up using them only once and they’re not a smart financial move. Instead, reach out to your friends and ask them to borrow a dress or bag from their closet. 

14. Spend Money To Save Money

No need to read again, this point’s title is correct. While spending might seem like the enemy of saving (and most times it really is), sometimes spending money on time can save you hundreds (or thousands!) in the long run.

Let’s say your car’s engine has been making a strange sound. You hear it, but nothing’s wrong with the car. It still takes you where you want to go and no smoke is coming from anywhere. Why waste money in it when there’s nothing, right?

A couple of days later, the car breaks down. Do you know how much it’s gonna cost you now, compared to fixing the engine problem two days ago? Probably much more. 

Sometimes fixing a problem before there really is one seems unnecessarily painful to our pockets, but waiting until the issue becomes bigger (and more expensive) is even more painful and counterproductive. 

So don’t skip your medical check-ups, ignore your car’s strange sounds or the roof’s minor leaking. Fix things while they’re little, easy and cheap. Don’t wait until the problem eats up your whole savings fund. This is the difference between being frugal and cheap!

As you can see, minor changes in your life can have a huge effect on your savings habits and reward you with large sums of money to splurge on your dream vacation or to continue saving toward a larger goal.

No matter how much or little you can save right now, keep at it. The key to saving money on a tight budget is being consistent, even if it’s a penny at a time: remember, every coin matters 😉   

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