How to Manage Your Money When Your Income is Limited

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Money management isn’t easy for many, and it can feel especially challenging when you have a low income. Finding ways to make ends meet can feel like a daily struggle, but there are steps you can take to help make a limited income stretch as far as possible. To help you get started, here are some tips on how to manage your money when your income is limited.

Understand Your Bills

The first step to more effective money management is to understand where your money must go. Review your regular expenses, like housing costs and utilities, as well as payments associated with debts, like loans and credit cards. Record information about the minimum payment due for every bill, or averages for fluctuating expenses like your electric bill. These figures will serve as a foundation for your budget.

Make a Budget

Now that you know where your money needs to go every month, you can create a functional budget. Record every expense, as well as the date payment is due, and subtract those amounts from your monthly income. The amount left over is what is available for other spending.

Your other spending should also be divided into categories. For example, groceries, fuel for your vehicle, and entertainment costs could all have their own categories, and add an additional category to direct money to a savings account. Then, divide the remaining amount of money accordingly, and make sure you place at least a little into savings every month. This will help create a buffer against future unexpected costs, such as the failure of a home appliance or car repairs.

Cutting Costs

If your expenses exceed your income, then it is important to explore how to cut expenses. First, you need to examine any bills that relate to luxury services. This can include items like television and cell phone plans. Begin by exploring what can be canceled entirely, as well as whether lower service tiers can meet your needs. Then, make the changes to your services and update your budget.

You can also work to lower costs associated with utilities by being more aware of your usage. Or look into lowering your housing costs by either relocating or possibly finding a roommate with whom you can split some of the costs.

Government Assistance

Depending on your full financial situation, you may be eligible for government assistance. Programs available through Centrelink, a program run by the Australian Government, can help individuals and families with certain expenses if they qualify – even cash advances and benefit loans.

Programs are geared toward a range of situations including carers, families, the disabled, older citizens, and more. Some benefits are administered as payments while other are tax benefits designed to lower overall tax obligations. Many of these support options can help alleviate some of the financial burden associated with certain expenses, helping to make money management simpler when you have a low income.

To qualify for government assistance, you must meet specific requirements. The exact qualifications vary depending on the type of assistance being sought.

Area Non-Profits

Assistance may also be available through a variety of non-profit organizations located throughout the country. Help can be found for a range of situations, providing options for everyone from qualified low-income college students to families to the elderly. Services available through these organizations can help offset or eliminate certain monthly costs, making it easier to make ends meet.

Additionally, some organizations can help qualified individuals explore new employment options. This can help provide avenues to higher paying forms of employment which may help your household raise the level of income upon which they can rely.

Support options can be located through a local service finder, as well as by searching for charitable organizations in your area.

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