5 Ways to Save Money when you're Broke | My Debt Epiphany (2024)

Saving money is essential in order for you to turn your financial situation around because it builds a safety net to help you cover random expenses whenever life throws them your way.

Life can be very unexpected, so having a decent amount of savings can help you feel more financially secure, stop living paycheck to paycheck, meet one of your financial goals, or even all three.

But I Don’t Make Enough Money to Save…

This is a response I get from a lot of people, and it’s one of the biggest myths there are out there. If you commit to living below your means no matter what, you will always have something left to save.

Here are 5 ways to save money when you’re broke and get rid of that ‘I don’t make enough’ mindset.

1. Adjust your Lifestyle to Save Money When You’re Broke

If you don’t earn a lot of money, you can try to find a new job or add an additional stream of income. In college, I lived on about $500-600 per month and this was with a child. Granted, I was receiving some financial help from the government for food and medical care, but I also worked a part-time job during college and increased my income while living a very basic lifestyle because not working during school was not an option for me.

Even now, there’s been times where I only have $50 left from my paycheck to spend freely after I’ve paid all my bills and contributed to savings and I just have to make it work. I know that deep down if I ever felt like I wasn’t making progress with my financial goals, I could always move in with my parents to regroup and save more money.

I probably wouldn’t like it because I enjoy my space, but it would be a temporary lifestyle adjustment to get me to the next level.

A great way to save money is in the area of purchasing groceries. Fetch Rewards is an app that helps you stretch your dollar even further by helping you earn points and rewards on your regular shopping selections. It basically removes the hassle of coupon clipping and the stress of shopping around for the best offer. Not only do you save money but you also save time so it’s a double win. You can learn more about this awesome app here.

Once you start to become honest about what type of lifestyle you can afford and embrace simplicity, you’ll be able to save more even with a lower income.

Related: How I Earned $6,000 in One Summer by Side Hustling

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2. Pay Yourself First

This is a popular way to ensure that you save money every month. When you get paid, transfer money directly to your savings account or set up a recurring automated transfer to do it for you. Then, you can spend the remainder of your money on bills and as you please.

Your best bet is to set up a high-yield online savings account. Online savings accounts are great. You can manage your money from the comfort of your own home, and since the bank doesn’t need to fund local branches, they can offer much higher interest rates on savings account so you can actually earn more money on your account balance as opposed to just pennies per year.

I use CapitalOne 360 because it’s free to open an account and they don’t have a minimum balance requirement. As an added bonus, they offer a .75% interest rate on savings accounts and you can receive a $25 cash bonus when you open your account as long as your first deposit is at least $250.

When paying yourself first, I still believe you need to have a budget in mind. If you overdraft and have to pay fees, then this strategy will need to be adjusted. After you’ve calculated all your fixed and necessary expenses, determine a good amount to save so all that’s left in your account will be money for variable expenses and non-necessities. Learn how to budget here.

Related: Why Do You Need a Full Emergency Fund?

3. Get Free Clothes or Buy Used

Everyone needs to buy clothes at one time or another. One year, I went about 8 months without buying any clothes but eventually, I had to purchase some clothes since some of my older outfits were becoming unwearable.

To generate savings from this particular area of your budget, you can either commit to not buying clothing for a few months and contributing that money to your savings account instead, or you can reduce your clothing spending by purchasing gently used clothes or obtaining clothing for free from family, friends, giveaways, and clothing swaps.

For used clothing, there are plenty of nice places to find gently used clothes in good condition beyond the typical Goodwill stores. I personally like Plato’s Closet and Clothes Mentor. I also shop at online consignment shops like ThredUp which offers gently-used clothing for some great deals. With ThredUp, you get a free $10 to spend just for signing up.

4. Avoid Late Fees and Cancel Subscriptions

Check all your accounts to see if you are paying any unnecessary fees that can be canceled. Some checking and savings accounts and even credit cards charge a useless monthly fee so it’s important to make sure you’re not paying extra for not having enough money in your account or some other insignificant reason.

I am actually going to call one of my credit card companies this weekend who is charging me some $14.50 maintenance fee each month for practically nothing since I don’t even use the card anymore. It was my first credit card so I keep it open to help my credit history, but the fee is just so not necessary.

You should also make sure you are paying your bills on time so you don’t receive any late fees and cancel any subscriptions you have as well. If you are on a tight budget, subscriptions are just not worth it in most cases.

This includes Netflix and Hulu. Combined they come out to about $16 to $22. While it’s a cheap solution to cable, it’s also not a necessity if you don’t have the extra money. If you have internet, some networks share their shows online for free each week or you can always check out YouTube series or get an antenna to watch basic television at no cost.

Related: 50 Expenses You Can Cut ASAP to Save Money

5. Refinance your Debt

Nothing is worse than having debt and feeling broke. If you are trying to make ends meet and have unpaid balances to deal with, it can get stressful. Refinancing your debt may be a good option to lower the interest rate and/or your monthly minimum payment amount.

Since I count certain debt payments as saving as long as you aren’t accumulating additional debt, you may find some relief in this option. If you have federal student loans and are going through a financial hardship, you may be able to qualify for deferment to postpone your requirement of having to pay on your loans month.

LendEduis one of my favorite free resources when it comes to refinancing student loans because it lets you browse different offers for a lower interest rate without even running your credit.

Not everyone will qualify for defermentand it’s only an option if you truly need it because there are a few downsides like having to pay more over the life of your repayment since your payments are lower. However, during the time your loans are in deferment, you can save up money to build a solid emergency fund.

Being able to save money when you’re broke can be a true challenge, but it’s always worth it in the end because you can’t get ahead financially if you don’t save. Once you get over that obstacle, there will be much better days.

Have you ever felt so broke you couldn’t save? What are some extra tips or strategies you would add to this list?

My Favorite Resources

CapitalOne 360 – My favorite high-yield online savings account. Earn $25 when you open an account.

Ebates – This is my favorite and easiest way to earn cash back for regular online shopping. Ebates partners with most online retailers to help you apply coupons to your purchases AND cash back. They pay me a nice check every quarter with my earnings.

Betterment – This is where I keep my Roth IRA. Betterment is my favorite investing tool because they do all the heavy lifting for you which is so helpful especially if you’re completely new to investing and have no idea what you’re doing.

CreditSesame– My go-to tool to check and monitor my credit for free.