How to Manage Your Money When You're Poor
- 1). Make a budget of essential expenses and stick to it. If you notice that a certain necessary expense is rising, such as your electric bill, do all you can to cut costs, including turning up the thermostat on your air conditioner and unplugging unused appliances and devices.
- 2). Cut out all unnecessary expenses, including eating out, going to the movies, buying any clothing, accessories or other items that you don't absolutely need. Unless you need it for work, Internet service isn't an essential; you can browse the web at your local library or community center. Cutting back can be difficult, but it will be worth it in the long run. Once your finances are in better order, you can then buy the things that you want.
- 3). Avoid using credit cards -- all they're good for is putting you in debt. Many people like to use the excuse that credit cards are good for emergencies, but they're rarely used for true emergencies. Another thing to avoid is payday loans. The interest rates are high, and payday lenders prey on poor people because they know the chances of them being able to actually pay off the loan without incurring extra fees are low.
- 4). Use money managing features provided by your financial institution, such as text or email alerts that let you know your current balance after each purchase. You need to carefully watch where your money is going and how much you have before making any purchases.
- 5). Stop writing checks. Some people with financial difficulties write checks with the intent of covering the amount due before the check posts. Not only is this risky, but it can get you in legal trouble. If you have a checking account, use a debit card instead.
- 6). Get a reputable prepaid debit card, such as one from Netspend or Vision Prepaid -- ensure that your funds will be FDIC-insured These accounts will allow you to shop online, at the grocery store and pretty much anywhere else major credit cards are excepted, but they won't allow you to incur extra charges, aside from a yearly or monthly account fee. If the money isn't in your account, the transaction simply won't go through, unlike banks, which often charge overdraft fees. Some prepaid debit cards also offer savings accounts and direct deposit.
- 7). Clip coupons for everything from groceries to car maintenance. Join the mailing lists of the brands and companies you use most so that you can be sent exclusive coupons and deals. Any little bit that you can save, even if it's only a few cents, will help.
