"Save a part of your income and begin now, for the man with a surplus controls circumstances and the man without a surplus is controlled by circumstances." - Henry Buckley
My parents have served many times helping counsel folks at church who were struggling financially. From them, I have learned some important aspects that most people don't think about when they are budgeting their meager salaries: Savings and allowance. Adding two more things to set aside money for seems to contradict the phrase "making ends meet," but in actuality, applying them to your budget can help you gain more control over your spending and place you ahead of the money game.
Setting aside something, even a few dollars, out of your pay has the power to change the way you feel about your situation. It's never to late to start. Here's how:
Find a place. Establish a savings account at your bank or credit union or, if you don't want it quite as accessible, open it at an alternative financial establishment. If you don't want to do that, find a safe place at home. Bear in mind that most financial institutions offer a small interest. It may not seem like much, but it adds up and it's free money.
Choose an amount. Start out moderate. If you set aside too much, you may cut yourself short and be tempted to throw in the towel. Once you are comfortable, increase by a dollar or two. Slowly build. You will be amazed at how fast even the smallest amount begins to grow. Slow and steady wins the race.
Commit! Don't touch it. Forget it exists. If you can, have the bank automatically deposit it from your paycheck so you don't even have to handle it. I know people who keep savings in a freezer container in ice. That way, if they are tempted to spend it, they have to wait for it to thaw out. By that time, they've usually come to their senses.
If savings is a hard concept to swallow on a tiny income, try this one on: giving yourself an allowance. Here's why it works.
Deprivation leads to discouragement!
If there are things you want and can't have, sometimes you buy other smaller things to try to fill the void. You may wind up spending money earmarked for bills and then you're in a world of hurt. Instead, give yourself a smalll allowance of discretionary money that has no rules attached to it. By not depriving yourself, you are actually better able to adhere to a budget.
It's kind of like when you want chocolate and there isn't any in the house. So you eat everything else trying to fill that lack of chocolate. Or you know full well you can't afford to walk into Sears, but you go to Dollar Tree and wind up spending three times what you might have spent on something worthwhile at Sears. Sadly it is human nature. Satisfy the need for some control, even a little bit, and you'll have more success in the long run. You will be more likely to pay the bills on time if you feel that you are not being deprived.
If there's something big you want, save for it. Otherwise, don't put any rules on your little allowance. Rent a movie. Buy some ice cream. Save for that Harley. Just don't get discouraged. If you are a couple, each of you should get an allowance and it should be the same amount, however small, and the rule should be that you don't gripe at each other about what you spend your few dollars on!
Budgeting is a nasty little essential part to responsibly handling your income. Consider adding these two things to your budget and watch the magic happen.