living on a small incomeI’ve been doing it for a while now – living on $1,600 a month. And living comfortably at that.

I have always liked to keep my budget low and when I quit my day job last October I knew it was really important to keep my expenses in line. The good news is as my income starts to grow I can save or invest any money I earn over $1,600.

I find that living on a low budget is actually a gratifying experience and anyone can do it.

Whether you lost your job and need to downgrade your lifestyle or you just want to save and invest more money you can live on less.

Here’s how.

Find Cheap Housing

If you live in a big city then there’s probably no way you’re going to be able to dramatically cut your expenses. Your rent or mortgage payment will account for too much of your monthly budget. You have a few options: move to save money, find roommates, or suck it up.

I’ve grown up in the country, rural Ohio to be exact, and here housing is super cheap. There are foreclosures and bank owned homes popping up all over the place and the prices start at only $20,000. You can get a very nice home with a good bit of land for about $100,000.

And rent isn’t too bad either. The average rent here ranges from $450-$600.

If you really want to live on a smaller amount of money you need to look for a cost effective housing solution. This will be your biggest expense.

Avoid Debt

One of the reasons I’m able to keep my budget so low is because I have no consumer debt. But this wasn’t always the case.

When you’re constantly making payments on money you’ve already spent for things that you probably didn’t need, it’s going to be hard to live on less. If you have debt you need to get rid of it ASAP.

Start throwing any extra money you have on your consumer debt. To gain momentum try using the debt snowball method. With this method you simply list your debts from smallest to largest balance. You then throw everything you have toward the small balance while making minimum payments on the rest.

Once you get rid of your debt you will be able to live on a smaller income. Also, be sure not to take on any more debt unless absolutely necessary.

Find a Cheap Hobby

For me having a cheap hobby was key. It kept me entertained and prevented me from going out and spending money that I didn’t have.

Find a hobby or start a side business that you can work on every day. When you find something that you are excited to work on or do every day you’ll be less tempted to go out and spend money on entertainment.

Track Your Spending

There are other areas beside entertainment and housing that can drain your wallet. Maybe it’s that trip to the gas station everyday where you spend $7 on food and snacks (Used to be me.) Or maybe you go overboard with “sales” at the grocery store. Once you figure out the problem you can come up with a solution.

When you track your spending you’ll be able to pinpoint your weaknesses.

Start with a spreadsheet and track every purchase you make for a month or two. (Here are some tips for successfully tracking your spending.)


If you want to live on less you can. It might not be easy, at least at first, but it can be done.

Start with your big expenses. Cutting these back will immediately lower your budget. If you’re still not satisfied work on cutting the smaller things.

It’ll take a little time to adjust, but living on a small budget is actually pretty satisfying.

What are your best tips for living on less?

Photo Credit: Jannoon0028

About Alexa Mason

Alexa Mason has written 192 articles on this site..

Alexa Mason is a freelance writer and wanna be internet entrepreneur. She is also a newly single mom to two beautiful little girls. She chronicles her journey as a single mom trying to make it big at

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