10 Ways to Stretch Your Dollar on a Low Budget Income

With the economic downturn and many families facing unemployment, people are struggling to make ends meet. If you've recently lost your job or suffered a cutback, you may not know where to begin with living on a lower income. Fortunately, there are some ways to stretch your dollar to cover all of your living essentials.

1. Make a budget and stick to it

You cannot save money until you know how much you have to spend. Use software or a pen and paper to determine how much income you have and how much your monthly expenses cost. Adjust these numbers until the income is the same or higher than your expenses. You may have to remove some expenses to keep the budget balanced.

2. Make sure that you are not over paying for housing

Your housing expenses should not cost more than 30 percent of your total income. If you're paying substantially more for housing, you need to find a way to adjust this number. This may mean moving to a cheaper apartment or finding a way to reduce your mortgage.

3. Discount supermarkets

Not all supermarkets sell food for the same price. Depending on where you live, you may be able to save money on some staples or produce by shopping at an ethnic market. You can also take advantage of price matching at some stores, such as Wal-Mart, or buy in bulk at a warehouse like Sam's or Costco.

4. Purchase clothing at the end of the season

Clothes usually go on sale at the end of the season so that the store doesn't need to put them back in storage. Take advantage of these discounts and buy clothes in advance. If necessary, buy a size up from what you currently wear so you can be sure it'll fit; you can always hem if needed.

5. Contact the Low Income Home Energy Assistance Program (LIHEAP)

Low-income families are able to receive governmental assistance to pay heating or cooling costs for their homes. You can contact LIHEAP directly or speak with your electric company to determine if you might qualify for this program.

6. Shop Thrift Stores and Consignment shops

Buying used can definitely save you money on clothes as well as furniture, toys, books or other household items. Be sure that any item you buy is in good working order, without tears or stains. Shop around among several neighborhoods as well for the best deals; some thrift stores have much higher prices than others do.

7. Section 8

This is a government assistance program that provides low-cost housing to families with a low income. It also allows you to receive some assistance toward purchasing a home. To see if you qualify, you can inquire with the state Department of Housing.

8. Public transportation

You can save money on gas and car insurance by reducing the amount of time you drive. You can usually buy a bus pass cheaply and use the bus to commute to all of your necessary destinations. Depending on the quality of public transportation in your city, you might even be able to sell your car and put the money toward vital purchases.

9. Don’t buy major purchases unless they are a necessity

While it might be nice to upgrade your TV or buy a new car, every major purchase you make comes at the cost of not having that money to spend on necessity items. Put plenty of thought into each purchase. Never buy on credit; instead, save up enough to afford the item out of cash or use a layaway program.

10. Find other ways to supplement income

You may be able to start a part-time job or even a home business that can supplement your income. The Internet has made working from home easier than ever, so you may be able to make money by writing articles, taking surveys or completing tasks for others. You can search online for ways to make money, or you can find a way to translate your hobbies into a source of income.

Some people find that living on a very low income creates a lifestyle that they enjoy. Even after their finances become more comfortable, these individuals maintain a lifestyle of voluntary simplicity. While such a choice isn't for everyone, it goes to show that living on a low budget is definitely possible.

Jessica Bosari is a freelance writer and blogger for various publications and her own telecommute writing jobs blog. You can read more of Jessica's work here. If you have any comments or questions about SavingTools or about saving money, leave your comments in the form below or email jessica@savingtools.com. Thanks!