When your finances are already squeezed, saving money might seem like an unrealistic option. The good news is that there are plenty of ways to save money on a tight budget – they just require a little planning, patience and determination.

18 easy ways to save money on a tight budget

Whether you want to pay off debts or save for a rainy day, getting a grip on your finances is crucial if you want to achieve your goals. Not sure where to start? Here are our top tips for living on a tight budget and saving money at the same time.

1. Set a budget and review it regularly 

Start by setting yourself a weekly or monthly budget, and use a budget planner to help you. It might sound obvious, but it’s essential if you want to keep your spending under control. Be sure to review your budget before each payday to check whether you’re on course to meet your savings goals. If you’ve overspent in a certain area, try to identify ways to reduce your expenditure in this category. 

2. Save money on your food shop

There are lots of ways to save money on your weekly food shop. As a starting point, plan your meals before heading to the supermarket. This will help you to avoid making unnecessary purchases and reduce the amount of food you waste. 

Another great way to keep your supermarket spending in check is to buy less meat. Good quality meat can take up a sizeable portion of your shopping budget, so try cooking a few vegetarian meals instead.

You can also make your money go further by choosing supermarket own-label items over more expensive big brands, and don’t forget to take advantage of supermarket loyalty cards and apps. They will often give you money-off vouchers or discounts, but be mindful that these savings aren’t cancelled out if the shop is more expensive than a competitor. 

3. Reduce your motoring costs 

For many people, motoring costs account for a significant proportion of their annual spending. You can keep costs down by shopping around for cheaper insurance. Use a price comparison site to compare deals and find the best price. 

But it doesn’t stop there. You can also reduce fuel costs by consolidating journeys wherever possible. Better still, leave the car at home and walk or cycle instead.

If you’re planning to buy a car, be sure to read our article on all the things you need to know about saving for a car before making your purchase.

4. Keep your energy bills down

Gas and electricity costs can soar during the winter months, which can be particularly challenging when you’re living on a tight budget. However, you might be able to save money by changing your tariff or switching suppliers. Moving to another provider is easy to do and, according to Ofgem, usually only takes around 15 days to complete.

Or why not turn down your thermostat? Research suggests that lowering your thermostat by just 1°C could save you up to £80 per year on your energy bills.

5. Look for a cheaper mobile phone plan 

You may be overpaying for your mobile phone. Find out if you can save money by reviewing your monthly bill and data usage. If you’re not using your full allowance, you may benefit from switching to a cheaper tariff with a lower data cap. Even if this isn’t the case, it’s worth speaking to your provider to see if they can offer you a better deal. 

6. Establish some savings goals 

If you’re worried about staying motivated, set yourself a goal of saving a specific, realistic amount of money every month. It’s also wise to create some long-term saving goals, too. For example, “I want to save £2,000 in six months for a family holiday” or “I want to pay off £3,000 in debts by the end of the year”. 

Once you ring fence your savings for a specific purpose, you’ll be less likely to spend the money on other things. You could even get your friends involved and take on a savings challenge together. Not only will you have some moral support, but you’ll also have someone to be accountable to. 

7. Declutter and sell things you don’t need 

Why not have a clear-out and sell your unwanted items? There are plenty of ways to sell second-hand goods online, with Facebook Marketplace, eBay and Gumtree being some of the most popular sites.

Not only will decluttering bring in some additional cash, but you’ll also be able to see what you have and avoid the need to re-purchase lost items.

8. Track your spending

If you’re struggling to save money on a tight budget, begin by tracking your spending. Keep hold of your receipts and use a banking app to monitor your account activity. Although it’s not quite real time, an app on your smartphone means you can easily keep an eye on your outgoings and, crucially, your bank balance.

If you’ve got a Raisin account, our simple online platform and app allow you to view and manage all of your Raisin accounts in one place – so no more remembering multiple logins.

9. Limit meals out

Everybody likes dining out, but if you’re eating out a couple of times a week, it can soon add up. Keep spending down by limiting meals out and cooking special meals at home instead. 

If stopping at the nearby coffee shop forms part of your daily commute, you could save money by preparing your morning caffeine hit at home. Cutting back on take-out drinks won’t suddenly make you rich, but it could save you a few hundred pounds over the year.

If you really can’t live without your barista-prepared lattes, don’t forget to take a reusable cup. Some coffee shops offer a discount if you bring your own eco cup.

10. Cut out non-essential purchases

Serious about saving? Then it’s time to put those non-essential purchases on hold – for now, at least. We all like to treat ourselves, but if you’re living on a tight budget then unnecessary purchases can easily send you over your spending limit.

Find it hard to resist that new pair of jeans or shoes? Why not arrange to swap items with a friend? If you like to go away for the weekend, you might also consider switching a hotel for a hostel.

While it’s not quite the same, it could help to keep your non-essential spending and impulse buys under control.

11. Give the credit card a break

Spending on credit cards and store cards can easily snowball, resulting in expensive interest payments if you’re unable to clear the balance in full. Limit the temptation to spend by removing credit cards and store cards from your purse or wallet altogether, and don’t save your account details online. Making it that little bit more difficult to spend may remove the temptation altogether. 

When finances are tight, incurring more charges is the last thing you want. Instead, work towards paying off any existing credit card debt and saving as much as possible.

12. Try self-care at home 

If you’re living on a tight budget, consider cutting back on expensive trips to the salon. Opt for a simple and low maintenance hairstyle that will allow you to stretch your visits, or try colouring your own hair. 

The same applies to other self-care luxuries, such as manicures. Doing your nails yourself (or asking a friend) could save you a sizeable amount of money.

13. Quit the gym 

Save money on a monthly gym membership by exercising at home. There are some great free workouts online, many of which don’t require equipment. If you’re worried about staying motivated, get an exercise partner and commit to regular workout sessions together.

Or why not jog or cycle to work? It’s ideal if you’re short of time and still want to get in some daily exercise (and it’s free!).

14. Do your research before making a big purchase 

If you’re planning to make a big purchase, like a laptop or new kitchen appliance, shop around to find the best deal. It takes a little effort, but you might be able to find the same item elsewhere for less money. 

Shopping comparison sites allow you to compare the prices of millions of items across thousands of UK stores. If you can find the item from a store listed on a cashback site, you may also be able to save a little money that way, too. Alternatively, you could also buy second-hand.

15. Agree on a gift spending cap at Christmas

The festive period can be particularly challenging when you’re living on a tight budget. Minimise the strain on your finances by agreeing on a present budget with family and friends. It will help to reduce the pressure and mean you’re less likely to overspend.

Arranging a Secret Santa is another great way to cut down on your Christmas spending. With fewer presents to buy and a set budget in place, you’ll be able to save money and reduce stress!

For more Christmas finance tips, read our guide on the best way of saving for Christmas

16. Start a side hustle

Search online and you’ll find plenty of ideas to make some extra cash on the side. For example, could you sell homemade crafts or art prints? This type of side hustle is becoming increasingly popular thanks to online platforms like Etsy.

If you’re not the crafty type, then think about other ways you can make some extra money. Maybe you could rent out a room in your home. Or if your driveway or garage is vacant during the day, why not rent it out to motorists? Car parking rental marketplaces allow you to list your space for free and take a commission on any bookings.

17. Avoid bank charges

While most standard bank accounts are free, some packaged accounts charge a monthly fee in return for extras such as breakdown cover and travel insurance. Although they can save you money in some cases, they’re not always the most cost-effective option, so it’s important to do your research before signing up.

Another way to save money is to avoid going into your overdraft. While it’s tempting to take out more than what’s in your account, you may incur fees as a result. And when money is already tight, accruing overdraft fees is far from ideal. 

18. Pay yourself first

Whatever your monthly income, it’s important to transfer a dedicated amount into a savings account. As soon as you get paid, try to set aside as much of your salary as you can comfortably afford for your savings.

How to live on a tight budget and still save money

There are plenty of good ways to save money on a tight budget. It might mean changing your habits and restricting a few luxuries, but these small sacrifices can be highly beneficial in the long run. 

If you want to see your savings grow, following these tips is a great place to start. You don’t have to do all of the above to save money, but the more effort you put in, the greater the savings rewards.

Saving money with Raisin UK

Saving money with Raisin UK is simple and easy. All you need to do is register for a Raisin UK Account and choose your preferred partner bank to open an account with. Some of the most popular types of flexible savings accounts that allow you to top up your savings and withdraw easily are notice accounts and easy access accounts:

Easy access savings accounts offer a good level of flexibility, allowing you to access your savings whenever you like. However, they tend to offer lower rates of interest. 

Notice accounts allow you a degree of flexibility in that you only need to give a short notice period, typically between 30 and 90 days, to your bank to access your savings – plus they typically provide more competitive rates of interest than easy access savings.

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