With the country brimming with unemployment numbers and limited job opportunities and options, most unemployed individuals struggle. They find it hard to meet ends and save a few pounds.
Within this condition, one cannot expect to save anything other than meeting the necessities. However, savings are critical to existence, just like a job. Well, you may not save a lump sum towards the month’s end, but you can save despite the existing crisis.
Yes, you can!
Make lifestyle changes according to your current financial position. It does not imply living below the means but adjusting to the situation. For example, you can reduce some expenses. For example, avoiding dining out, ordering food often, additional credit cards or subscriptions, etc. Instead, increase your income prospects. It will help you save comfortably.
The blog lists tactics to re-analyse finances and save money with limited income.
6 Fool-proof Ways to Save Money Despite Low Income
Saving money with low income requires planning, resistance to impulse shopping, and knowledge. By having a tab over these 3 things, you can achieve your goal of saving money on low-earnings. Wherever you are in your income status, you can rationalise your potential to save money. Here is how you can do that:
1) Understand your financial situation
It is the first thing that you should analyse after losing your job. Check how much and what things you spend the most monthly. It could be household utilities, insurance, school fees, car fuel, subscriptions, recharge, etc.
Check whether you can reduce or cut some of these expenses. While doing so, prioritise the most important expenses. Additionally, you can use a budget planner to do this exercise successfully. It will help you plan your expenses and reduce extras hassle-free.
2) Stop pension and other contributions
While you may have begun workplace pension contributions for a carefree retirement, halt there. It is not worth contributing as you do not hold the job now. Alternatively, individuals with personal pension plans should also put their monthly contributions on hold.
It is an important part of prioritising expenses. Presently, think about improving your current situation and use the money wisely. However, stopping pension payments may isolate you from receiving the tax and other benefits.
These may include the benefit of getting paid even if you cannot work or pay your dependents after the death. Check out the benefits that you may miss before skipping payments. Moreover, check whether you can contribute a part of your income.
3) Use benefit loans instead of savings
Most individuals tap their savings to fund an urgent expense. It further dilutes it and impacts the further lifestyle plans. What if you do not have to tap savings for short-term expenses? Yes, options like loans for people on benefits income may help you counter such expenses hassle-free. No, it does not impact your credit score, not your existing income frame.
You get the sum that you can comfortably afford to pay back. Moreover, you can use the facility for emergencies that hit your door anytime. Make a quick application online and get the money in the respective account briefly.
This initiative prevents you from tapping savings and keeps it intact for critical requirements. If worried about debt-trap, don’t be. It is because you never pay more than you owe and that is with flexible repayment tenure. It eliminates every fear of defaulting.
4) Try to save money on household bills
You may not know, but you may be paying more than you ought to on certain services and bills. Shocking, right? Yes, that’s true. It is because out-of-job individuals receive some benefits from the government. It includes low-cost utility services and installations. If you want to save money on everyday utilities, check the below schemes:
a) Energy Price Guarantee
It increased for households with a usage count of £2000-£3000/year from April 2023.
b) Low-cost plans for broadbands
It is for individuals leveraging universal benefits- universal credit, job-seeker allowance, pension credit, and employment allowance.
c) Free school meals
If you want your child to eat healthy despite low income, then free school meals grants from the government may help. Individuals with universal credit may get free meals.
(d) £1200 help on saving £50p
It is a Help to Save bonus scheme where you can get £1200 if you save. It works like you get £50p bonus on every £1 you save. It works like a savings account for the universal income claimants.
These assistance programs and schemes may help you save around 60% on household expenses. There are more facilities like this from the government that may help improve your lifestyle. Check and apply if eligible.
5) Buy nothing new for at least 100 days
Yes, you may think of it as something hard to achieve, but you can do this. Everyone has a busy cycle. For example- one invests in apparel generally twice a month or a new instrument. It bases the choice, income aspects, and wants of the person.
However, if you spend more on additional things monthly, you must stop it. Take up this challenge of buying nothing new until your finances improve or you get a job. You will be surprised to check the savings you can accumulate this way.
6) Consolidate debt
Lastly, you must not avoid or neglect pending debts. Increasing penalties and interest costs may make it unaffordable for you later. Thus, analyse the best ways to clear some strategically. Check whether you can make partial payments on some.
If yes, leverage the opportunity and do so. Additionally, begin with high-interest costly debts first. Apart from reducing liabilities, it may help you improve your credit score. If you have too many debts lined up, but you cannot pay all, consolidate debt.
If you cannot consolidate all debts, get loans without a guarantor for a bad credit score. In this way, you can clear maximum debts off your list. Moreover, without a guarantor on the board, you stand a better chance to improve your finances strategically and individually.
Bottom line
These are some critical ways to save money despite low income. If you have been facing a constant financial crisis, identify additional income means. It will help you counter expenses the best way. Moreover, update your profile and skills to match today’s competition and grab a suitable job. Unemployment that lasts longer becomes a part of lifestyle and constant financial battles. Avoid it by consistently seeking favourable income opportunities.
