How to save money with minimum wage — 9 ways to save money while earning a low income. Proof that it’s not possible and anyone can save. I am not a licensed financial advisor and this post is not financial advice.
Believe it or not, it’s not impossible to save money with a minimum wage job.
Although you won’t be able to save as much money as a high income earner, it’s still possible to get ahead financially. You just have to accept that your progress will be slower.
And on the plus side, a minimum wage earner knows how to live on less automatically.
For the record, I currently earn well over minimum wage. But I know for a fact that I could live on 15 hours per week at my current job because I keep my expenses low.
Using the same skills I use to live on 15 hours per week or less, I will show you how to save money with minimum wage.
Let’s dive in.
How To Save Money With Minimum Wage
How To Save Money With Minimum Wage — 9 Legitimate Options
1. Start With A Small Percentage
Many people overlook how small amounts add up over time.
They mistakenly believe it’s not worth their time, so they hold off until they earn a higher income. Frankly, this is just another excuse.
Also, saving money is habitual. You either save regularly or you never will.
As such, it’s best to start as soon as you have an income and gradually work up towards saving large amounts.
In my opinion, you should start by saving $25 per pay or even 1% of each pay.
Even though it’s a small amount of money, I promise you that it will make a difference over a long enough time frame. Furthermore, you will begin to build the habit of saving money on a regular basis.
2. Increase The Percentage Monthly/Annually
Once you have proven that you can save a small amount of money, you can push yourself to save more.
For instance, if you have saved $25 per pay for six months, try saving even $26 per pay to see if you can do it.
If you save in percentages, try to increase the amount you save by even 1%. So if you regularly save 10% of your income, try to increase it to 11%.
Even if you are not successful, at least you tried and know what the maximum amount is that you can comfortably afford to save.
3. Pay Yourself First
One of the main tricks you can use to save money with a minimum wage job is paying yourself first.
Rather than paying all of your bills and then making the excuse that you can’t afford to save, try paying yourself first as if you are one of the bills.
Again, you can start by saving a small amount of money each payday.
Of course, I am not saying that you should stop paying your bills. You don’t want to hurt your credit rating.
I am merely suggesting that you consider saving money as one of your bills. It should be one of your top bills, and it should determine how much you can afford to spend on other expenses.
4. Maintain A Budget
In order to successfully save money, you will need to maintain a budget to track your expenses.
This is especially true if you earn minimum wage.
Simply put, you need to know where your money is being spent.
Although it may seem tedious and boring, budgeting is an absolute must because it serves as a constant reminder to not spend.
Related: How To Budget – 7 Simple Steps To Build A Successful Budget
5. Avoid Restaurants
I’m sorry but unless you live at home rent-free with your parents, you can’t afford to go out to restaurants as a minimum wage earner.
Maybe once or twice per year at most.
Since food is one of the main expenses besides housing and transportation, it’s one of the key areas you will need to cut back on.
Instead of wasting money on overpriced food at restaurants, make your meals at home and prepare your lunches in advance.
6. Take Public Transportation
In my opinion, minimum wage earners can’t afford to own a car unless they live at home with their parents.
Even then, it still seems like a tremendous amount of money to waste when you aren’t earning very much.
I mean, a car payment, gas, parking, and insurance could easily add up to nearly half your earnings.
So instead of owning a car, the best course of action is to take public transportation.
Obviously, it will be less clean, slower, and you will feel like a peasant. But it won’t be forever and at least you will be able to save money.
Also, there are some advantages to not owning a car. For example, you don’t have to worry about parking it, regular maintenance, car insurance, getting gas, or unexpected expenses.
In some ways, being car free is an easier way of life.
Additionally, a car is less necessary than ever now that more people are working from home.
7. Don’t Buy Brand Name Clothes
Frankly, buying brand name clothes is stupid even if you do make a lot of money.
It’s actually quite an ironic thing to do, because the purpose of buying brand name clothes is to show other people you can afford them. But by purchasing brand name clothes, you are actually making yourself poorer.
Once you grasp the idea that the people who display their wealth are the ones that actually have no money, it’s impossible to not see it.
I always go back to the following quote from Morgan Housel from his book, The Psychology Of Money:
“Wealth, in fact, is what you don’t see. It’s the cars not purchased. The diamonds not bought. The renovations postponed, the clothes forgone and the first-class upgrade declined. It’s assets in the bank that haven’t yet been converted into the stuff you see.” — Morgan Housel, The Psychology Of Money
Moreover, if you pay attention to a lot of the smartest people in the world, they dress surprisingly plain. They basically have their own uniform. For example, the late Steve Jobs always wore a black turtleneck and jeans. Mark Zuckerberg is usually wearing a hoodie or a t-shirt.
It’s the person wearing a Gucci belt, who wants you to think they’re rich, that usually has nothing in the bank. What you see is what they already spent.
Related: Dress Well On A Budget – (11 Tips) To Look Dapper For Cheap
8. Don’t Sign Up For More Bills
As I alluded to earlier, small amounts add up over time. This doesn’t only apply to saving money.
Every extra subscription or monthly cost will make it harder to save. So stop making purchases that add to your monthly bills. Stop inflating your life until you make more money. And even then, try not to inflate your lifestyle.
The last thing you want to do as a minimum wage earner is sign up for more payments.
Avoid signing up for extra bills like the plague.
9. Live With A Roommate
In the book Early Retirement Extreme, the author, Jacob Lund Fisker, talks about the big three expenses: food, transportation, and housing.
Since we have already discussed a few ways to cut back on food and transportation, it’s time to look at housing.
Although it might not sound too appealing, one way to cut your housing costs in half is to live with a roommate.
Admittedly, I despise the idea of living with a roommate and giving up my personal space. I need my alone time. So this would be the most challenging one for me.
But if I had to in order to save money, I absolutely would live with a roommate rather than live pay cheque to pay cheque.
In short, living with a roommate is the quickest way to cut your expenses in half.
How To Save Money With Minimum Wage – Final Thoughts
Now you know how to save money with minimum wage.
It may not be what you want to hear because it requires sacrifices. But it’s far from impossible.
For most minimum wage earners, the best way to start is to create a budget.
From there, you can get an idea of how much you can afford to save.
Remember that it’s ok to start small. Start saving even $25 a month or 1% per pay. I promise that it will add up.
Other Personal Finance Posts To Check Out
Pay Yourself First: How To Pay Yourself First
How To Budget: 7 Simple Steps To Build A Successful Budget
Dress Well On A Budget: 11 Tips To Look Dapper For Cheap
Save Money On Groceries: 14 Highly Effective Ways To Reduce Grocery Costs
I am not a licensed investment or tax adviser. All opinions are my own. This post may contain advertisements by Monumetric. This post may also contain internal links, affiliate links to BizBudding, Amazon, Bluehost, and Questrade, links to trusted external sites, and links to RTC social media accounts.
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