Lesson 2 of 3 · 2 minute read
Ways to save when money is tight
Small, automatic steps that add up, even on a low income.
Saving can feel impossible when your pay barely covers your bills. These ideas can help, even if you start with $5.
Pay yourself first
Most people try to save whatever is left at the end of the month. Often, nothing is left. Try the opposite: move a small amount into savings right when you get paid, before you spend anything else.
Make it automatic
You don’t need willpower if you don’t have to think about it.
- Ask your employer to split your Direct depositWhen your paycheck goes straight into your bank or credit union account, with no paper check.More in the glossary, so part of each paycheck goes straight into savings.
- Or set up an automatic transfer from checking to savings on payday.
If you use a transfer, set it for the day after your paycheck usually lands. That way it won’t cause an Overdraft feeA fee your bank may charge when you spend more than what's in your account and the bank covers the difference.More in the glossary.
Start with an amount you won’t miss, like $5 or $10. You can raise it later.
Save part of any extra money
When extra money comes in, like a tax refund, a bonus, or a gift, save part of it before you spend the rest. Even saving half makes a big difference.
Find a few dollars
- Cancel a subscription you don’t use, and move that amount to savings each month.
- Cut back on one want, not everything.
- Some banks and apps can round up your purchases and move the spare change into savings.
Small amounts add up
$5 a week is $260 in a year. $10 a week is $520, which is more than a $500 starter emergency fund.
Save right when you get paid, before you spend anything else. Even $5 is a good start.
Make it automatic. Ask your job to split your Direct depositWhen your paycheck goes straight into your bank or credit union account, with no paper check.More in the glossary, so part goes straight to savings.
Or set up an automatic transfer to savings. Set it for the day after payday, so it won't cause an Overdraft feeA fee your bank may charge when you spend more than what's in your account and the bank covers the difference.More in the glossary.
When extra money comes in, like a tax refund, save part of it first.
Small amounts add up. $5 a week is $260 in a year.