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If you’re already on a tight budget, it can be difficult to find additional ways to save money, especially ways that make a big difference. However, if you’re like me, you’re constantly looking for tips or tricks that you can use to save more of your hard-earned money. Keep reading to learn 18 effective ways to save money on a tight budget.
Table of Contents
Pay Yourself First
Probably the most effective way to save money on a tight budget is to focus on saving money first, then worry about everything else.
Even savings as small as $20 a month can help. It may not seem like much, but by the end of the year, you’ll have $240.
However, before you do this, make sure all of your needs are taken care of.
This includes:
- Shelter
- Food (eating out isn’t a need)
- Water
- Heating/cooling
- Other items you need to continue earning a living
- For instance, if you work outside your home, you may need transportation of some sort
- If you own a cleaning business, cleaning supplies may be a need to continue generating an income
Once you know your needs are taken care of, you can use this trick to ensure that you save before anything else.
Build an Emergency Fund
Even a small emergency fund can help you weather the bad times. This keeps you from dipping into your savings at the slightest hint of trouble or, even worse, taking out debt to pay for unexpected purchases.
If you are interested in learning more about emergency funds, click here.
Pay Off and Avoid Using High-Interest Credit Cards and Payday Loans
High-interest credit card and payday loan debt should be avoided like the plague.
If you already have high-interest debt, get rid of it.
You could save hundreds or even thousands of dollars a year just by taking this one step.
Take Advantage of Employer Retirement Matches
If your employer offers a retirement match, you should be taking advantage of it.
That match is “free money” that you are passing up each paycheck. Don’t leave any easy money on the table if you can help it.
Similar to paying yourself first, make sure you can take care of your needs first. It doesn’t make sense to contribute up to the match if it causes you to miss a mortgage payment.
Housing
Consider a Roommate
Do you rent or own a place with an extra room?
Consider renting it out.
Most people’s largest expense is housing. By taking on a roommate you could potentially cut the expense in half (or more).
Consider Other Housing Opportunities
Don’t be afraid to look around for other housing options. You might have to move a little further away from work, school, etc., but it may be worth the transition.
Refinance Your Home Mortgage
In today’s low interest environment, consider refinancing your home mortgage. You may be able to refinance to a lower rate (and lower monthly payment) without having to put any money down.
Food
The category in most people’s budget that has the most flexibility is the food budget. To save money on your food budget, consider the following:
Cut Back or Eliminate Eating Out
Buying groceries and cooking your own food is considerably cheaper. If you truly want to save more money on food, first step is cutting back or eliminating eating out.
Lower Your Grocery Bill
If you’ve already eliminated eating out, there are some easy ways you can save money on groceries without having to bother with coupons. These include:
- Use the food you already have before buying more
- Plan your meals around grocery store sales
- Find recipes that incorporate food you already have and/or sales items
- Make a grocery list
- Keep a rough cost estimate in your head while you shop to stay on budget
- Buy generic
- Compare unit prices
- Buy in bulk
- Don’t buy more than you need
- Freeze meals for later
- Start an herb garden
- Start a vegetable garden
- Only buy meat when it’s on sale
- Skip meat once or twice a week (or altogether)
- Shop online and pick up at the store
- Avoid checkout aisle purchases
- Avoid shopping at eye level
- Don’t be afraid to ask for a rain check on sales or coupon items
- Learn when produce is ripe
- Store your food properly
- Don’t shop hungry
- Don’t buy precut produce
In addition to the list above, you can also download a coupon app like coupons.com or use a cash back app like Ibotta.
Entertainment
Cut the Cord
Another category in your budget that may be low-hanging fruit is your entertainment budget.
If you have cable or satellite TV and a decent internet connection, you might consider switching to a streaming service like YouTube TV, Netflix, Disney Plus, Sling, Hulu, Amazon Prime Video, Philo, etc.
If you’re worried about losing your favorite programming, there might be a way to combine two services and still save money. I love sports and my wife loves Hallmark, so we compromised with YouTubeTV and Philo.
Even having two streaming services, we still saved ~$60/month on TV by cutting the cord.
Consider Free Entertainment
Visit Your Local Public Library
If your budget is really tight, forego the entertainment budget altogether.
A great place to start for free entertainment is your local public library. Many libraries have access to books, audiobooks, movies, CDs, magazines, newspapers, free Wi-Fi, free computer access, as well as a whole host of digital features.
In addition, they typically have access to career services, test preparation services, and even personal development workshops. To learn more about what the library has to offer, check out this list of library benefits.
Attend Community Events
Look at the community website for the local cities and towns around you. There are often many events you can attend for free.
Also, consider joining a community sports league or local group for a hobby you enjoy.
Visit the Great Outdoors
Some of the cheapest and healthiest ways to spend your time involve the outdoors. Depending on where you live, you can visit a local park and go hiking, running, camping, kayaking, biking, swimming, etc.
For a list of National Parks, you can visit the National Park Service’s Find a Park page or google state and local parks near you.
Many cities, municipalities, and counties have parks departments, so you can visit their website as well for information.
For example, if you’re looking for parks in Charleston County, SC; you may consider visiting the Charleston County Parks & Recreation Commission’s website for more information.
Utilities
Lower Your Energy Bill
When it comes to your utility budget, one of the items you have the most control over is your electricity bill.
To truly see where you can save money on electricity, look into either performing an energy audit yourself or hire someone to perform one for you.
To learn how to perform a do-it-yourself home energy audit, check out this guide on Energy.gov (Dept of Energy’s website).
Since your heating and cooling, refrigerator, freezer, hot water heater, dryer, and dishwasher are typically your biggest users of electricity, here are a few effective ways to save money on your electricity bill:
Heating and Cooling
- Add a few degrees to the thermostat in the summer, drop a few degrees in the winter
- Upgrade to a smart thermostat
- Close doors, windows, and curtains
- Turn off or turn down the air conditioner when not at home
- Be strategic with your oven use – use it more during the winter and during the coldest parts of the day
- Inspect heating and cooling equipment annually, or as recommended by the manufacturer
- If you have a forced air furnace, replace filters as recommended/required
- Locate and seal air leaks
- Install/replace weather stripping
- Inspect your insulation and consider adding insulation if needed (especially in easy- to-reach areas like the attic or crawlspace)
- Upgrade windows (this includes window treatments, window inserts, or even just replacing windows with more energy efficient alternatives)
Refrigerator/Freezer
- Consider consolidating your freezer goods into one freezer and abandoning your second freezer (this goes for a second refrigerator too)
- Consider using the toaster oven, crockpot, or microwave in lieu of the oven
- Keep your refrigerator and freezer at the ideal temperature (typically less than 40° F in the refrigerator and 0° F in the freezer)
- Vacuum the condenser coils regularly
Washing Machine
- Run full loads
- Wash laundry in cold water
Dryer
- Hang dry your laundry
- If you have it, use sensor dry versus time dry
- Toss a dry towel in the dryer or use dryer balls
Dishwasher
- Run full loads
- Skip the heat dry setting
Misc. Appliances
- Unplug devices not in use
Water Heater
- Take shorter showers
- Take cold(er) showers
- Turn water off when shaving, washing hands, and brushing teeth
- Consider upgrading to a tankless water heater
Lighting
- Turn off unnecessary lights
- Take advantage of natural light more
- Use more focused lighting for the task at hand (lamps, track lighting, under-counter lighting)
- If you haven’t already, consider upgrading light bulbs to compact fluorescent lamps (CFLs) or light-emitting diodes (LEDs)
Lower Your Water Bill
Here’s a few quick ways you can save money on your water bill:
- Turn off the water when you aren’t actively using it (when you’re brushing your teeth, washing your hands, when you’re lathering up in the shower, washing the dishes by hand, etc.)
- Use your dishwasher – it uses less water on average than washing your dishes on average.
- As mentioned before, make sure it’s full before running it to save on water and electricity!
- Use less water when flushing – you can upgrade your toilets to low-flow or add something like a sealed ½ gallon container filled with water to the tank (this means a ~½ gallon less water each time you flush).
- Run full loads in the washing machine and dishwasher – this saves both water and electricity!
- Invest in water-saving faucets and showerheads
- Be on the lookout for leaks (especially in older homes)
Lower Your Transportation Expenses
Some of the most effective ways to save money on transportation include:
- 30+ simple ways to save money on gas
- Avoid toll roads
- Trade your vehicle for a bicycle
- Carpool
- Use public transportation (buses, trains, etc.)
- Look for local transportation incentives – you may be able to save money if your local city or town is trying to encourage public transportation
- Also, some big cities offer discounts if you pay in advance for public transportation and use their fare cards
- Consider selling any vehicles you don’t use
- For instance, if you have a truck that you only use twice a year for hauling things, consider selling it and renting or borrowing a truck when you need it
- Telecommute – if your work will allow it, see if you can work from home a couple of days a week.
Switch Cell Service
If you are currently using one of the “big 4” wireless carriers (Verizon, AT&T, T-Mobile, Sprint), consider switching to a cheaper option like:
- Ting – especially the Verizon-based service
- Total Wireless
- Mint Mobile
- Google Fi
Lower Your Insurance Expenses
Ways to save money on insurance include:
- Bundling car and home insurance policies (as well as other items that can be bundled like RVs, motorcycles, boats, etc.)
- Look for obscure discounts
- This could include a discount for not smoking, being a new homeowner, setting up automatic payment – reach out to your insurer to see what discounts are available and if you qualify
- Raise your deductible
- Improve your credit score
- Reassess your personal property coverage
- Have you sold items of value? Do you still need the same coverage?
- Shop around
Ways to Save Money on a Tight Budget – Conclusion
I wrote this list aiming for the money saving tips that would have the biggest impact on your finances. If implemented, these ways to save money on a tight budget really can help you save money each month.
How do you save money on a tight budget?