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how to budget when you have no money

Ever feel like you’re drowning in debt? Or feel overwhelmed when you or someone else in your home wants something new that costs money?

I know I do!

My family, of 4, lives on one income and it can be tough sometimes. But, we always seem to get by, and with the new movie that my husband always needs to have!

For the longest time, actually ever since my husband and I started living together; we haven’t had a ton of money. There was never a time when both of us worked full time for more than a few months. It’s always been just one of us working. And, for most of the time(or at least 3 – 4 years), that person has been me. We’ve never made more than 25K in a year, even with me having a bachelors degree.

So, no, we’re not able to rely on one income because one of us makes enough for the other not to work. It’s simply more important to us that one of us stays with our two little girls, instead of sending them to a daycare center!

Plus, we have two children, and daycare isn’t the cheapest. If we both worked then childcare would take up about one of our paychecks each week. And, I’m not a fan of leaving my kids with strangers. (I’ve also worked at a child care center before and wasn’t a fan of the child to teacher ratio, especially for infants. How is one adult supposed to care for 4 infants all by themselves!!)

That’s why only one of us will ever work outside the home, at least until both our girls are in school. And, that is why I make our one income work for us. That, and the fact that I get to be the one to stay home with my girls now; as challenging as it can be some days! I’d still prefer being with them than being at a job I don’t care about and get no satisfaction out of.

Let me explain how we’re able to live on one low income and still make room for my husbands need for consumerism.


If you’d rather take a course on budgeting, and see the instructor teach you through video- check out Cara’s Busy on a Budget Course!! I know everyone learns differently and simply reading how to create a budget doesn’t work with everyone’s learning style.
Or, if you need an awesome workbook to get your budget under control, get the Budget Binder Bundle from Caroline!

What’s your Income?

No, you don’t have to tell me! But, you need to know!

The first step to creating a budget is knowing approximately how much money you bring home in a month; the more accurate, the better! This will determine how much you can pay towards your bills and the extras. Y

ou don’t want to calculate your gross income here, make sure it’s the net. We get enough taxes taken out each month to make a pretty big difference. You don’t want to think that you’re bringing home $2,000 a month when it’s really only $1,600. Which is just about the most my family has ever made in a single month!

My families income was one of the reasons I wanted to write this post. I see so many posts from other people about how to budget with a low income, but then they’re saying they only make 50-60K a year. They tell you all these ways you can budget to make that low of an income work. Well, that’s not really a low income. I would love it if we made that much in a year. We’d get a second car so I’m not stuck home all day, and we’d be able to get into a house and pay for a mortgage! So, for those of you who actually have a low income like my family; this post is for you, to let you know that you’re not alone, and it is possible to still live well on a very tight budget!

Once you know how much you bring home in a month, you’ll want to know how much you bring home every time you get paid, as accurately as possible. This will be helpful when you start to set up your actual budget and determine when certain bills get paid. Hopefully, all of your bills aren’t due at the same time as your rent or mortgage. If they are, you’ll just need to be a little more careful about your spending with the paycheck you get that isn’t right before those bills are due. Or, instead of focusing on the due date, you could pay the bills when you get them. Depending on how you’re doing financially, will determine how easy, or difficult, this may be.

Always estimate your income low when trying to figure out how much you bring home each month!!

Pay your rent (or mortgage) first

When you know how much money you bring home in the month you’ll want to make sure that your housing expenses are not more than half of your income. Many other sources will tell you to only put 25-35% of your income towards housing. If you can do that; then good for you!

But with 25% of my households income on a good month being about $400, that’s not realistic. Unless of course you’re willing to rent me a 2-3 bedroom home for only $400 a month that has enough space for 4 people and a yard for my girls to run around in. Or, if you want to just give me a house to live in free of charge, that’d be cool, too!

But, realistically, if housing is more than 50% of your income, then you will need to find somewhere cheaper to live or find a better paying job. Or else, you’re going to be eating away at any savings you may have to just survive. Life is about so much more than just surviving! (Trust me, when our rent was even slightly more than 50% of my income, I had to take out credit cards to pay for things like gas and food….I was just able to pay off the 4 years of accrued debt from them this year, all $3,900 of it! Now, onto paying off student loans…)

'Life is about so much more than just surviving!'Click To Tweet

Housing should also be the first bill you should be concerned about paying. If you don’t pay for your housing and you end up getting evicted; your internet and other expenses that come with having a home won’t really matter all that much anymore! The only expenses that you may need to put before housing should be food or gas. You need food to survive, and you need your vehicle so you can go to work and make money to pay your bills.

Become Organized

Now that you know your approximate monthly income and the most important expenses that need to be paid first, we can start creating that budget!

And, yes, that means getting organized and making a list. So, go ahead and write down all of you current expenses and bills. Make sure you include the small bills too, like netflix or hulu; include everything in this list, even those trips out for lunch. You need to know exactly where your money is going each month. This will make it so much easier to see where things can be cut or where you need to add to your budget.

Obviously, I can’t tell you how you should spend your money; everyone’s situation is different and what works for me may not work for you. You may need to eat out everyday for lunch, whereas I don’t and I’d rather make all home made meals(it’s quite a bit cheaper this way). Depending on your budget for food, that may be alright for you; but, my budget for food does not allow for my family or even one person in my family to eat out everyday. My budget allows for maybe one meal out a week or every two weeks (which usually happens to be on the same day that we go out to get groceries and do laundry because we’re exhausted and starving by the time we come home and to be honest, I just don’t want to cook).

Once you have a list of all of your bills and expenses; make sure they have a money amount next to them, so you know how much you spend on them. Then, write down the due dates of bills or other monthly expenses. It may take you a month of tracking expenses to find out how much you spend on bills or other expenses. Or, if you use a card for everything, you could check out your last statement and go through that for the dollar amounts. It’ll be quicker and you would be able to start having a more accurate budget sooner! If you use cash, track everything you spend your money on for a month. Hopefully, it won’t be too tedious!

 

Dedicate some time…and a notebook

Making a budget won’t take too much time, but it will take some time at the beginning; anything new will!

You also don’t need much to create a budget. If you want, you could make it on your phone with an app, on your computer with a word doc or excel sheet, or you could use a notebook and pen like I do. I don’t know about you, but I like writing things out in a notebook, with a physical pen, when it comes to budgeting or meal planning. It feels more real to me that way; I can’t just hit the backspace button if I change my mind about something.

I found a ‘budget’ notebook that was 2 for $4 at an arts and crafts store, about a year ago. (It’s even cheaper now online!) So, I bought two of them for my budget tracking. But, you don’t need anything fancy for budgeting, a simple notebook that you can buy for 10 cents at the beginning of the school year, works just as well! It may not be as fancy or won’t have headings or labels, but it’ll work. A simple notebook is what I used when I first started budgeting, and it works perfectly!

When you get your notebook, if that’s what you’re using, I’ll teach you how to set it up! Just keep reading! Or pin this post for later use!!

Setting up your Budget Notebook

At the front of the notebook you should write down all of your monthly bills, or quarterly, or yearly bills. This way you’ll know what absolutely needs to be paid each month (or saved for bills that don’t occur every month). Also, if you have any debt, write down the amount, what it’s for, and how much you pay on it monthly on the first page. Who knows, maybe by the time you have the notebook full, the debt will be gone. But, having this written down will help you determine what debt you should try to pay off first if you come across extra money!

Each page, or every couple of pages, will be a new month. On the first few lines for each month write down your paydays and the expected amount. If you’re unsure of the amount, estimate low not high. This is vital in the way that I budget!

Below the income you should write down any financial goals for the month, or the amount of debt you have and what each is for; it’s fun sometimes to see it go down each month. Plus, if you notice that it’s not changing much, then you’ll be able to see that and hopefully fix the issue. Like, if you’re only paying the minimum payment on your credit card every month and the entire payment is simply going towards the interest and you’re not even making a dent in the debt. Then you should probably focus on putting any extra money you can towards that bill to get rid of it and then never use that card again. That’s just my opinion!

The next section for the month goes to all of those lovely bills you have to pay. If you’re unsure about the amount then estimate high, I usually round up to the nearest $5 increment. This trick, and estimating the income to be lower than it may be is the trick I use that allows my husband to buy the movie he needs to have every once in awhile. $3 here, $10 there, it really adds up in a month with this kind of estimating. It also helps when you’re unsure how much a bill is going to be and you need a little extra for electric, or another bill, one month. Or, better yet, the money you estimated for electric is $50 too high; that’s always a nice feeling. This month I estimated $20 too high!!

What to do about those Miscellaneous Expenses

The final section for each month will be for all of those miscellaneous expenses, like food and gas. Each household will have differences with these expenses, but how you track them should be the same. You’ll either need to find your bank/card statements and see how much you are spending on expenses that aren’t bills; or track your spending to see where your money goes. You may be surprised at what you find! I’ve found that when I meal plan and buy only what I need for groceries for my family for the whole week; we could get away with spending only about $40 for 4 people. But, then again, I never go shopping alone. My husband ends up putting food that only he’ll eat in the cart and our grocery bill doubles. So, I need to account for that when planning my budget for groceries.

*hint *hint: Go grocery shopping alone if you can, you could cut your grocery bill in half!

Another thing that’ll help you, if you do end up spending a lot on groceries, is getting cash back on groceries! My favorite way to get cash back on groceries is by using Ibotta. Simply download the app, add the offers you bought, and scan your receipts after you shop. It’s that simple! I got $26 back my first month using Ibotta, and just the other week I got $3 back on diapers alone!

Other miscellaneous expenses will include gas for you vehicle, if you don’t live within walking distance to work. It may also include any money you spend on eating out, buying clothes, or movies, birthday gifts, toilet paper, etc. This section is also for any unplanned expenses; expenses that don’t happen every month, or expenses that greatly vary from any other given month. These are the expenses with the most play; the ones you can add to or take away when needed.

What you get out of Budgeting

You should have a clearer picture of where your money is going when you’re done creating your budget;  maybe even where you need to limit your spending to pay off some debt, or save up for birthdays or special occasions. Creating a budget will help you financially and emotionally (if it stresses you out like it does to me)! Having a budget and actually sticking with it can help you from going further into debt. It also helps you stress less about money, or lack there of.

Sometimes you’ll have to go outside of the norms with your budget and you won’t be able to go shopping every month, or for an entire year! But, if you’re serious about getting your finances in order, you sometimes have to grow up; realize that food on the table for you family is more important than that weekly shopping trip to the mall.


Don’t forget to check out Cara’s Busy on a Budget Course!!
Or get the Budget Binder Bundle from Caroline!

how to budget when you have no money

If you found this at all help, please share. And, I’m glad you were able to get through this whole post without falling asleep. I hope it helped you or someone you share it with learn how to budget when you have no money.

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How to Make a Healthy Meal Plan on a Budget

The Benefits of Meal Prepping

How to Keep a Clutter Free Home!!

Don't have enough money to get things you 'need'? Read this to find out how! how to budget, budget for beginners, paycheck to paycheck, debt, bills, no money
Don't have enough money to get things you 'need'? Read this to find out how! how to budget, budget for beginners, paycheck to paycheck, debt, bills, no money


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