9 Awesome Tips to Save Money and Feel Empowered When You’re Broke
Anxiety bubbles up in your stomach as you check your bank account. Your latest paycheck barely covers rent and food for this month. Hopes of enjoying the night out with your friends this weekend are dashed. How are you supposed to make ends meet and enjoy your life at the same time?
This situation may sound dire, but according to a 2018 study from CNBC, nearly one-third of Americans are stressed about money on a regular basis. What’s worse, if you’re a millennial, the Pew Research Center highlights that there’s a greater likelihood you’re in poverty and struggling to meet basic needs compared with other generations. If you’re trying to establish yourself in today’s difficult economic environment, it can feel like an uphill battle when you can’t balance the books.
Read on — CreditMarvel has tips for how you can have more fun, feel empowered, and take control of your finances in 2019!
1. Know you’re not alone.
Don’t feel ashamed if you’re having money troubles.
According to a study that the Federal Reserve Board has conducted since 2013, 47% of Americans surveyed said that they couldn’t come up with $400 to pay for an unexpected cost. That’s a lot of people who are living paycheck to paycheck.
Now turn that sad statistic into something good! One way to boost self-esteem and to promote a positive outlook is to reach out to your community. Find groups in your area who stay active but do so cheaply. For example, this might mean taking a rain check on the groups that frequent the most expensive city clubs and instead joining a crew who potlucks in the park.
Some apps like Meetup have options to search by topic, too. If you want camaraderie coupled with money advice, there are ways to search for groups that frequent things like seminars about living on a budget and financial planning. In many places, there are affinity groups (e.g., for women) for financial education, which can make you feel even more included.
2. Make a plan to avoid surprise.
Take a few hours before or after work, sit down at your computer and open up a spreadsheet. Start planning. Strip your finances to their bare bones in order to calculate your cost of living. The Numbers app on the Mac Store and Microsoft Excel provide templates to get you started, along with other fun apps like Mint and Quicken Premier.
How much is rent or mortgage? How much do groceries cost for your household? How many gallons of gas are required for your weekly commute?
Once you’ve figured out all of these amounts, you’ll be able to get a better grasp of how much of your paycheck is regularly used to pay bills. This way, you won’t be surprised when you click that balance.
3. Budget what remains and speak to a financial adviser.
If you follow suggestion number two, you’ll know how much money you have left every month after all bills are paid. Even if it’s just a couple of dollars, invest those funds in a savings, money market, or low-risk mutual fund. Compound interest ensures that any amount saved today is worth far more down the line, especially if you’re able to attain a favorable interest rate. If you ever have a financial emergency, this cushion can help you through it.
CNN recommends this rule of thumb for savings. Some financial advisers take it a step further by suggesting you put away savings before you pay a single bill!
Speaking of financial planners, some commercial banks may offer free or inexpensive basic advice to customers (especially newer ones). Even if you can’t book an appointment with one of the bank’s designated advisers, remember that bank managers are also trained finance professionals who can answer baseline questions about savings vs. checking, CDs, interest rates, and loan repayment.
Money issues cause stress, and this can take a toll on the body and mind. To reduce anxiety, find ways to ease payday pain.
Meditation and mindfulness are great avenues to calm yourself. You don’t have to master any special chant or sit still for long periods of time. People meditate by taking a walk outside, by laying down and just closing their eyes for a few minutes, or by cooking or baking.
Along a similar vein, visit your local library and find a good book! As you become enraptured by the pages of the latest bestselling novel, you’ll find many of your troubles melting away.
5. Find ways to make extra income.
Alternatively, fill up your free time with a lucrative activity!
If you can’t go out because of budget restraints, you’ll have time to do other things, so discover what interests you. Do you enjoy painting, crafting, or writing?
Start investigating freelance opportunities. Sites like Etsy or Upwork offer ways for people to make a little extra cash doing what they love.
Forbes offers an excellent article on what to consider when starting a freelance business—including finding your niche audience and how to promote your work. Sites like GoDaddy Smart Line also provide tools and advice to help you launch a business.
6. Discover ways to cut corners.
You don’t always have to shop at the organic market or invest lots of money into redesigning your living room.There are plenty of ways to DIY decorations, upgrades, or activities with family and friends. Plus, videos from popular sites like Food52 offer fun, creative ways to make delicious meals without breaking the bank.
Gas and other commuting costs like tolls can be helped by investigating carpooling, public transportation, or alternate routes to work.
Volunteering isn’t just a way to distract yourself from financial concerns. It can also be a way to pick up new skills and expand your network. Who knows? Maybe it will even lead to a higher-paying job down the line.
Examples of ways you can volunteer to make yourself a more valuable hire:
- Take on a leadership role. If you’re stuck in a junior or mid-level position at work that doesn’t offer much room for creativity or advancement, taking on a volunteer project is a way to shine. You can display and build skills for project management, recruiting and HR, budgeting, and marketing, to name a few. Put this on your resume to impress a new company!
- Acquire a new technical skill. Volunteering at a bank or computer science academy, for example, can expose you to valuable tools and resources you can use to solve problems in your current workplace.
- Market yourself. Volunteering is a great way to gain visibility. Hand out business cards or host events for the community that you volunteer with. They’ll quickly get to know you. If and when a job opens up, they might recommend you as a candidate.
These are just a few ways, beyond a simple brain shift, that volunteering can help you take control of your financial situation.
8. Double your efforts with a partner.
If you’re recently married, there are loads of ways to save money by taking advantage of marriage tax breaks. These small deductions can add up each year, helping you chip away at debt or save for something fun, like a romantic getaway!
- If one spouse is jobless (e.g., a stay-at-home parent), he or she can still qualify and contribute to a spousal IRA.
- If both partners have jobs with benefits, you have the option to pick the most valuable benefits from among both plans.
- If you have a family, you can qualify for child tax credits.
Doing a bit of research on how you qualify can go a long way towards easing your financial burden. Read our full resource for more tips.
9. Don’t let it consume you!
Everyone at some point in their life encounters a financial issue. The most important thing is to remember that the situation is not forever. Try not to obsess. Don’t sacrifice your physical or mental health because of a low bank balance.
If you follow some of the tips listed here as well as pick the brains of friends and family for what has worked for them in similar situations, you’ll be able to eventually maneuver your way out of penny-pinching.
Plus, these budgeting experiences are great for growth and perspective when investing and handling money in the future!
Nearly half of Americans suffer from a lack of funds. This means that budget restraints are common, and people have found creative ways to enjoy life even while pinching pennies.
As we mentioned in this article, you can join groups tailored specifically for people on a budget, encourage friends to plan and participate in cheaper activities, seek the help of a financial professional as you figure out your personal budget, maintain wellness, consider freelancing or volunteering to make yourself more valuable, and research your eligibility for tax breaks.
The diligence and patience required when living on a budget may help lead to a more in-control, centered, and confident you!