How to Budget when you don’t make enough money

Published on March 21, 2017 by Lauren

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  • Many people have been trying to answer the question of How to Budget when you don’t make enough moneyIt’s a difficult place to be in for sure. But just because you don’t make enough money to cover your expenses right now doesn’t mean you have to throw up your hands in defeat. you can get through this! Here’s how to budget in this situation.

    how to budget when you don't make enough money

    You lose your job. You get sick. Your husband loses his job. You are going through a divorce.

    These are huge life-altering challenges with relational, emotional and financial implications. Often, the result is a situation where you don’t have enough money to pay the bills. Talk about things that keep you up at night… we’ve been there.

    To describe the situation as ‘unfortunate’ is quite the understatement. More like “drowning without a life vest”. 76% of Americans are living paycheck-to-paycheck today (source), and just one event could cause a financial panic.

    Or maybe there was no single event that resulted in your financial situation – it’s just been the accumulation of increasing bills and a paycheck that hasn’t kept pace.

    Whatever the reason – not making enough money to pay your bills is a HUGE problem facing many Americans today – so what can you do to keep it from becoming an all-out financial crisis?

    I’m speaking from experience because I’ve been in $40,000 worth of debt and also got out of it (read more about it in my book The Recovering Spender).

    How to budget when you don’t make enough money:

    1.) Keep a positive mindset

    This is the hardest one, but also the most important. Negativity is attacking you from every direction.

    Thoughts like:

    You will never get out of this mess

    You will never find a job

    You will lose your home

    These thoughts will become a self-fulfilling prophesy if you give into them. And I’m saying this as a person who struggles with negative self-talk – it is a KILLER.

    I use my faith to remain positive, and you have to find what works for you. If you are able to stay positive and focused on what you need to do to get out of your situation, then reality will follow that positivity.

    Stop wondering how to budget when you don’t make enough money, and start believing and acting in faith.

    how to budget when you don't make enough money

    2.) Recognize that it is temporary

    Yes, this is bullet number 2, and you might be thinking ‘2 points in, and nothing actionable?’ This is on purpose.

    The actionable items below won’t stick if you don’t keep your head in the game. You need to act knowing that your financial situation will not last forever and that it is simply a challenge that you have to overcome.

    Do not let this become your lifestyle – choose to be an overcomer instead of a casualty.

    But the only way that it is going to be temporary is if you TAKE IT SERIOUSLY! Financially speaking, you need to SPRINT! But just like in running, you can’t sprint forever.

    So make your sprint count!

    3.) Cut, cut, cut

    Are you paying for cable? Use one of these cheaper alternatives to cable instead.

    Do you have smartphones? Sell them and reduce your wireless bill by using Republic Wireless.

    Do you meal plan and use coupons?

    Do you still go out to eat often? Here’s a list of 13 things that you shouldn’t be spending money on, so use this as a good place to start.

    I remember a time when we couldn’t pay our bills, I thought “well, what’s the point of budgeting?” That line of thinking was a huge mistake.

    Budgeting is more important than ever when you are running a deficit – you’ve got to drill down and figure out every single place that you can save money.

    4.) Get More Money!

    When you are running a monthly deficit in your budget, you have to attack this from both sides. Cut expenses and make more money.

    Yes, yes, I know. Easier said than done. But there are some things you can do from home and make extra money that you might not have thought of.

    What if you were able to cut $300 from your monthly bills, and then also make an extra $300 through odd jobs or working from home? That’s $600 more in your pocket.

    Can you work more hours at your job? Can your spouse go out and get another job or one of those side hustles?

    When you are in survival mode, no job should be beneath you, and any sacrifices you make are temporary because you are digging yourself out.

    If you had been laid off from a good-paying white collar desk job, it’s ok to deliver pizza for a while before you land that next job.

    how to budget when you don't make enough money

    5.) Prioritize your bills

    When there isn’t enough money to go around, how do you decide who gets paid and who doesn’t? Since we’ve been using the term “survival”, think of the things you would need to survive – food, shelter, clothing, transportation, energy… you’re first payments have to be the ones that keep you in your warm home, keep food on the table, and allow you to get to work.

    After that, you need to figure out what creditors get paid, and which don’t. If you don’t have enough to pay some creditors, make sure to communicate with them. You can negotiate your delinquent debt, and this might be the time to do it. But there are implications when settling debt, so be careful and make sure to do your research.

    And filing for bankruptcy is NOT the easy way out that you might think it is.

    Once you do all these things and finally see that light at the end of the tunnel, the key is to make those changes stick! And that might be the hardest part of this. to truly make them stick, you’ve got to make sure to track your spending. And to do this, I highly recommend a new company called Tiller. It’s brilliant… all of your bank account transactions are downloaded daily to a google sheet. And you can track any way that you want to. Sign up for Tiller HERE.

    In closing, here’s why I made the first 2 points mental rather than actionable – would you be willing to work those extra hours, to get rid of your smartphone, to take a job that might seem embarrassing, if you didn’t have a positive mindset?

    Would you have the energy to keep going, to keep trying if you weren’t in sprint mode?

    When I was facing a $1,000 monthly deficit in our budget, I immediately went out and found a waitressing job. And it SUCKED.

    But it only lasted for about 10 months.

    I got myself to a point where I could make it without me working there. And I was stronger on the other side of it… and you will be too!

    The question we have for you today is what are you willing to do to make this happen?


  • The worst part is when you are working seven days a week and haven’t been paid for the new job yet and have zero cash, an empty fridge and no gas, and you’re kids are trapped at the house because you are working with on shitty car and have no money so you can’t even afford to drive to the park none the less a happy meal….thanks to a wonderful economy where nobody hires over twenty hrs a week anymore and pays shit.

    • this should be titled how to budget yourself into poverty, budgeting is not realistic,
      or common sense the only way for you to have more money is do what the wealthy do live beyond your means, does not mean if you dont make enough money you should cut back that is terrible advice for people cut back the more opportunities they see where they become afraid to spend money to make more money is detrimental to your finances not better

  • i know dave ramsey and a lot of people say this, but i just don’t think i’ll ever understand it. i would get more excited by having to pay less money overall than the artificial achievement of paying off the credit card with the lowest balance first.

  • Last year I was off work for 5 months due to an accident that resulted in 3 knee surgeries (two of which were replacement surgeries, within 1 month of each other). I was totally immobile and non-weight-bearing for over 8 weeks. I thought I was going crazy! So I used up all my vacation and then started on short-term disability payments. I thought we were ok during this time and kept spending as we always had been. What was never explained to me was that once I returned to work, I had a very short turn-around time in which to pay back the insurance premiums (rather high, I might add) that I had continued to receive while out on medical leave. Because of this, my paychecks for the past 4 months were cut to less than half of what they had been. Since my husband is on disability only and is physically unable to work, this has hurt us something fierce. I’m just getting started on the budgeting and pay-up/pay-off of the credit cards and other monies we overspent on during the pay-back period. We are selling our older 2nd car; and I’m planning to spend this weekend going through the house to find things to sell — I already have a long list of things to put on Craig’s List and the local buy/sell/trade pages of FaceBook. I know I can get us through this, but it’s a really bad time to try to cut to bare bones since Christmas is quickly approaching and we have custody of our granddaughters who are 5 and 7. Obviously Christmas means so much to them at this age — I’m definitely going to have to get very smart and crafty to give them a good Christmas (by a kids standards of course). In order to keep myself positive through the process I’m challenging myself to meal plan, coupon shop, and cut expenses wherever possible. It’s almost like a game to me — but it’s what I need to keep on task. I know I can pull this off and we’ll come out better off on the other side — it’s just really tough right now; but I’ll get us though!

  • do you have a church sometimes a pastor will be able to help you connect with others in need to help you earn money for a service like driving someone to a doctor appointment or providing childcare for a mom or dad when they have to do chore and go to appointments these tiny jobs help out

  • […] After you’ve totaled up your basic expenses and your take home pay, subtract the two. This is your monthly spending limit. This difference will tell you how much you have to work with for the ‘extra’ stuff. If you don’t have enough for these basic living expenses, don’t give up! There are ways out, and there is a way to budget when you don’t have enough money. […]

  • Budgeting or resourceful planning isn’t really an issue for me. I just don’t know how to find a decent and reliable income. Isn’t there any way to live on some funds so you can learn to make yourself productive and marketable? I feel like I’m just desperately trying to find whatever I can get my hands on just to stay barely a float. How can I ever dream of one day having enough to care for more than myself?

  • What a great motivational article! When we were working to get out of $20,000 in debt there were two things that kept us going. One was listening to podcasts about success stories of peoples debt free journey.

    Number two was just like you mentioned. Remembering that the sacrifices we were currently making to put every penny we could towards our debt, was only temporary. When you can remember that, it creates a light at the end of the tunnel!

  • Another example of how our financial system abuses the poor. If you get behind in your bills, your credit score goes down, your insurance premiums go up and your interest rates go up. If you have an extra few thousand dollars sitting in your checking account, you get free checking. If you’re living from paycheck to paycheck, you have to pay bank fees or pay to cash your check at a check cashing company, then pay a fee for money orders. And so on.

    • EXACTLY! My car payment and car insurance are astronomical because of my credit which is due to HUGE MEDICAL bills! They act like I’m not paying my bills because I just don’t feel like it! How about helping those who are struggling, not punishing us!

  • What are you supposed to do when you have already given up cable, eating out, and all the other normal “luxuries”? When you have a husband that works two jobs, 7 days a week in a city you both hate, and you have to stay home with your toddler because daycare is too expensive and would eat up what little of a paycheck you are qualified to get? When you have $16,000 in credit card debt, and sunken credit scores? When no one will give you a loan for debt consolidation because your debt-to-income ratio is too high, when that debt is exactly what the loan is meant to take care of? I’ve done everything on this list and the 50 others I’ve read that all say the same thing. Nothing works. And a pastor or priest isn’t going to help. So now what?

  • How many years is “temporary”? A decade, two? And if you want to deceive yourself by having “faith”, then go right ahead. “Faith” is what prevented me from reducing my income expectations… I have experience, I’m educated, surely I’d be valuable to a company. Not the case. There is something else at work, and that is an inflationary society that makes people poorer and poorer with more stress.

  • This was the most useless article I’ve ever read. Just like all the others. “Budget”, “cut” seem to be the revolving factors. How about we stop electing cowards who let the credit unions run wild with interest rates? How about we lobby for pay increases. This system we got is designed to keep the poor poorer and with no other way up besides “starve” and “go without” while the bastards that put us here have NEVER had to experience a life crippled with their debt systems. Shit happens, people lose jobs, people get sick, people just don’t make enough money, at the end of the day what do the debtors do? Hold it over our heads and make sure we can’t move on with our life. Oh you paid it off? Ok cool, we’re still going to keep it on your report for 6 months. Wait you live in what neighborhood? Nah I’m not gonna loan you money. This is just more redlining, jim crow bullshit we have to go through because some old man can’t comprehend what it’s like to make under 30k a year before taxes and having roughly 2k a year that isn’t being used by upkeep.

    • yes, how about that!~
      The poor get poorer and punished for struggling and working our asses off the make ends meet!
      So F***** sick of it. I am good honest person and I feel like the only people getting anywhere are the CROOKS!

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