Saving Money

To have a low salary does not mean that you cannot save.
On the contrary!
By having a small income, we are much more likely to pay attention to it, to weigh our purchasing decisions and to reduce our unnecessary purchases.
However, many people on low incomes feel, and their reality proves that they are unable to save.
It is not the case since we can always save money on a small budget: it is all about attitude and especially money management.

The power to know how to manage your money.

Many people have even become wealthy from modest incomes. It’s not only because of their entrepreneurial traits but mostly because of their ability to manage their low wages at the start.

Action plan!

Let’s take a look at an action plan to save money on a small salary.
We will give you the steps to follow in such a way that you will be able to set up this plan easily.
Take a paper sheet and a pencil and write down the results of all of your steps. You can also take notes on your computer.

Calculate your monthly fixed expenses.

There are expenses which we, unfortunately, cannot part with, which fall each month and whose amount is generally fixed.

These are fixed costs that allow you to live your daily life:

• Rent for your apartment or house
• Mobile and landline plan
• Water, electricity and gas costs
• Auto, home, mutual insurance
• Monthly installments to pay off your credits

Calculate your monthly variable expenses

These are expenses that, like your fixed costs, are necessary for your daily life.
These can be variable from month to month depending on your needs and choices
These include:

• Food and restaurants
• Health expenditure
• Transport
• And other necessary and variable expenses

Calculate your impulse expenses.

These are the purchases that are not necessary for your daily life or your possible projects.
Calculate the impulse expenses you have made in the last three months and determine an average amount. This calculation will probably be beneficial and informative.

Calculate your monthly income.

This calculation should be quick because it is your salary.
If you are a micro-entrepreneur or if you have another situation, calculate the total income that falls on your account each month.
If your income is irregular, calculate an average over the year.

Analyze your monthly budget.

You are now able to have your monthly budget, expenses, and income in front of you.
Whether you’ve made a note on a piece of paper or your computer, you should have an overview of your monthly budget.
By summing up the expenses and comparing it to your income, you should be able to see your “financial health.”

Two cases are possible:

• The sum of your income is greater than that of your expenditure.
• The sum of your income is less than that of your expenses.

Go to real budget management.

This step is crucial if you often find yourself in financial difficulty.
It is also useful if you are struggling to save money.

To manage your money, you can start with:

Plan a monthly spending budget that will allow you not to be in the red at the end of the month and, if possible, to save. This spending budget must, therefore, be less than your income.

Save every month!

Set yourself the goal of saving every month, even if it is a small sum.
You have an idea of your budget and know how much you can afford.
It will allow you to finance projects that you think are impossible today.