15 Tips For Living on a $1,500 a Month Budget – How to cut costs, live frugally, and still live a full life by living within your means on a low income. Learn from a pro how to start saving money and how to get control of your finances no matter how small your income.
If you are trying to save money, it can seem quite difficult. You may be wondering if you could possibly live on such a tight budget. The good news is, most people can get by on far less income than they might imagine.
My husband used to make $17,000 take home every year for 4 years when we were first married and had our 2 oldest boys. Was it easy? No way! But those tough years taught us a lot about living on one low income. And we did it without getting into debt, too.
Living on a $1,500 a month budget is absolutely possible. Whether you’re in-between jobs, starting a business, paying off debt, or simply saving money, careful budgeting will help you meet your goals. Don’t be fooled, though. Living on $1,500 a month or less is an extreme goal which requires extreme measures. But with the right help, you can do it.
Need other ideas for saving money? Check out these other great resources!
- How to Make Saving Money Easy
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- 10 Money Saving Challenges to Start Today!
- 10 Crazy Money Saving Amazon Hacks
- How to Live on One Low Income
- 10 Purchases That Will Save You Thousands This Year
Here are 15 important tips and tricks for living on a budget of $1,500 or less each month:
Make a Budget
I know, I know…who really wants to do that? It’s tough and it’s boring and going through your numbers is downright depressing.
But the fact is, you need to know where your money goes each month in order to know what expenses you can adjust (or eliminate) and which you can’t.It might surprise you to learn how little you can spend when you take the time to plan everything out. Do not skip making a budget.
Record your spending for a month so you can see exactly where your money is going, or simply print out your online banking statement and study it. Then take a close look at how much you are spending and on what. Once you see areas where you think you should be spending less, start focusing on cutting back in that area. (My guilty pleasure is always spending on food.)
Related post:90+ Budget Categories That You’e Forgetting About
Prioritize – Wise Up About How to Spend Money
This is a great time to reallythink about wants versus needs.
Do you need a car, or can you take public transportation? Do you want a new outfit when you could use the clothes you already have to create a ‘new’ outfit?
When it comes to bills that need to be paid, focus on needs first. House (or rent) payment is the number one priority. Next comes food, utilities, healthcare, and other small bills.
Take that budget you made and prioritize your expenses, putting needs ahead of wants. You need to keep a roof over your head, you don’t need to be getting Chick Fil A every night.
Related Post:11 Expenses to Stop Spending Money On
Reduce Your Big Expenses
Even though your big expenses are necessary (think house, electric, car, etc.), that doesn’t mean that you can’t work to lower them. Lowering these big expenses can give you more wiggle room with your smaller expenses by freeing up hundreds of dollars per month.
Some effective ways that you can lower your larger expenses include:
- Can you refinance your mortgage for a lower interest rate or monthly payment?
- Can you refinance your student loans?
- Can you find a place to live that has cheaper rent?
- Can you sell your car with the big monthly payment and buy something cheaper that can be paid off?
- Shop insurance rates to lower monthly premiums for your home and car.
- If you need to purchase health insurance (because it isn’t covered through work), shop around for the best deal and consider choosing a plan with a high deductible to lower your monthly premium.
- Challenge your property tax assessment if you are paying more than your neighbors are paying.
Related Post:8 Ways to Stop Spending Money You Don’t Have
Examine and Cut Back Your Small Expenses
Those little day-to-day expenses will ruin your budget every. time.
Here are some examples of small expenses that can destroy your careful budgeting efforts:
- Random little extras you buy when you get gas
- Treats you buy your kids every time you take them to the grocery store
- Coffee shops
- High grocery bills
- Entertainment costs.
Once you see where your money is going in your budget, it’s time to find as many ways as possible to cut back. Don’t discount the small things—they can certainly add up fast.
Here are some Ideas for reducing your smaller expenses include:
- Use efficient LED light bulbs
- Turn off lights when you don’t need them
- Only use the water you need – don’t leave the water running when you don’t need to
- Keep your house at a steady temperature and try adjusting the temperature by a degree or two to save money (lower inside temperature in the winter; higher inside temperature in the summer)
Have a Savings Account for Unexpected or Irregular Bills
Life happens. Cars break down, kids get hurt, emergencies happen, and appliances need to be replaced.
You don’t want the headache of blowing your monthly budget because you had to buy a new washing machine.
Prevent this by keeping a separate savings fund for irregular bills and expenses that you contribute to monthly. Put as much as you can (try to add $75-100) each month to this fund. Prioritize this “bill” by saving before you spend.
Related Post: Best Money Saving Apps You Need
Set Up Your Monthly Budget to Be the Same Every month
Most utility companies will let you set up a regular monthly payment that averages out your bills so that you know exactly what you’re paying each month and don’t get any unpleasant surprises.
You can also budget certain amounts for bills that can vary, such as gas.
Do Without
Cut out unnecessary things or make switches to be more economical. For example:
- make coffee at home instead of going to the coffee shop (it’s a lot easier than you think)
- cut cable to stream Netflix—and ask a friend or family member to share an account to cut costs even more
- use a basic cell phone and plan instead of a smartphone with the more expensive service plan
You can get creative here, and doing so will yield huge savings.
Cancel Unused Expenses
Don’t watch the movie channels? Get the newspaper or magazines in the mail and never read them? Have a landline and a cell phone?Gym membership but you never go?
Ditch everything you don’t need to reduce monthly expenses. Even something as simple as a $2 monthly app fee adds up. Get rid of everything you don’tneed.
Reduce Your Food Bill
Food is a huge expense, but if you put in some effort, you can save a ton. Start by doing away with eating out. Cut it out completely for a month and see how much you can save. Have the “we have food at home” talk with yourself as often as you can.
Next, meal planning the key to saving big money on groceries. It’s really easy – especially when you have a pro do it all for you.
Finally, get creative to save at the grocery store. Get started with these ideas:
- Buy non-perishables (like canned vegetables) that will last
- Shop in bulk when possible
- Reduce how much meat you eat (it’s expensive)
- Eat in-season or frozen produce
- Purchase store brand products rather than name brands
- Shop at discount stores for food such as the Dollar Store or Aldi
- Use the food you have at home instead of buying more food.
- Use Instacart to make your list and not get anything impulsively.
Related Post:6 Steps to Drastically Reduce Your Grocery Budget
Share One Car Instead of Having Two
Keep gas, car insurance, and registration costs lower by owning just one car to share.
Depending on where you live, biking or making use of public transportation can also be great ways to cut costs. You may not even need a car at all.
Always Use Discount Codes or Cashback Apps When You Shop
- Use cashback websites. You can get up to 25% cashback on your purchases when you shop through Ibottaor Ebates (now Rakuten). As a bonus, new members get a free $25 gift card just for joining.
- Find coupon codes online. Before you buy, look for a discount online by searching for the company or product and the word “coupon.”
Related post:Best Apps to Save Money and Get Cashback
Pay Off Your Credit Card in FULL Each Month
Having a credit card is a great way to build credit and earn rewards. However, if you carry a balance on that card each month without paying it off completely, you are paying interest charges on top of what you owe. To meet your goal ofas spending a little as possible, make sure you cut every single cost.
This will help you to save money AND to stay out of debt. This is a place where your emergency fund will help you so much. Instead of paying for emergencies with credit cards that you will need to use to get out of trouble, you will have it in cash.
One more thing: you need to know yourself when it comes to credit cards. If you know that you spend like crazy on your card and can barely afford the bill at the end of the month, then maybe it’s time to cut up the credit cards and stick to cash or debit.
Change the Way You Shop
Practice pausing – stop and think before you buy anything.. When there is something you want to buy, don’t buy it unless you need it to survive. Otherwise, put it back and wait a few days before deciding whether to purchase it.
Also, buy used instead of buying something brand new. Clothing, furniture, toys and more are more cost-effective when you buy them used. Your child will never know the difference if their new train set comes from Goodwill vs. Target.
Sell items you don’t need
Chances are you have valuable items around your home that you don’t need anymore. Try selling them on eBay or Craigslist to earn some extra money for paying off debt or saving money. This is a great way to clean out your house and to make money from it. You’ve heard that all of the clutter around you used to be money? Yeah, it’s true. So turn it back into money.
You can also look up using ThredUp or Mercari to sell yoru brand name clothes.
Find Free Things That You Enjoy Doing
You don’t need to take your kids to Disney World to have a great time together. Hiking, reading, fishing and playing board games are just a few ideas of free activities to enjoy on a tight budget. There are plenty of things that you can do as a whole family that are free.
With some creative decision making, you can find a way to survive on $1,500 or less each month. It might not be easy all of the time (I know that using one car is tough) but the short term sacrifices mean a long term win for your, your family and your money.
I hope these tips for living with very little money help you to reduce your monthly expenses to the point where you can reach your goals.
15 Tips For Living on a $1,500 a Month Budget – How to cut costs, live frugally, and still live a full life by living within your means on a low income. Learn from a pro how to start saving money and how to get control of your finances no matter how small your income.
