1. Work out your monthly budget
This might be something you already do; however, it’s always a good idea to review your budget regularly. Understanding your monthly budget is an important part of saving money on a low income.
How to work out your monthly budget
- Start by making a note of your guaranteed income, after deductions. This could include wages from a full- or part-time job, as well as earnings from a second job or side hustle, and any benefits you receive.
- Next, subtract your essential monthly outgoings from your overall income. Essential outgoings are things such as rent or mortgage, food, bills (including Council Tax), and commuting costs.
- You should also consider any expenses that you’re expecting to pay in the month ahead, such as Christmas or birthday presents, a dental appointment, or your car’s annual MOT.
- After deducting your monthly essentials, the amount of money you’re left with is your disposable income and is yours to do whatever you like with. When thinking about how much money to save, you might set aside an amount of your disposable income (for example, £20), or a percentage, such as 50%. However much you choose to save, you should make sure it’s affordable, comfortable, and realistic for you.
If you want to get serious about saving, you might want to include savings as an essential cost when working out your monthly budget.
2. Assess your outgoings
Once you have an idea of your monthly budget, take a closer look at your regular outgoings. Make a note of any subscriptions and membership fees that you’re currently paying, such as Netflix, Spotify, or the gym.
Ask yourself whether you’re getting your money’s worth. If you’ve not watched Netflix or been to the gym for a while, consider cancelling these payments to save you some money.
3. Check your entitlement to benefits
What help can I get on a low income?
If you’re trying to save money on a low income, it’s a good idea to check if you qualify for any benefits.
People on a low income could be entitled to claim Universal Credit. Depending on your eligibility and circumstances, you could get a standard household allowance. As of 2025, this could be:
- £316.98 if you’re single and under the age of 25.
- £400.14 if you’re single and aged 25 or over.
- £497.55 if you live with your partner and you’re both under the age of 25.
- £628.10 if you live with your partner and either of you is aged 25 or over.
In certain circumstances, you could be eligible for more money on top of the standard allowance. You can find out more about Universal Credit and check your eligibility here.
The free Turn2Us Benefits Calculator can show you whether you meet the criteria for any additional support.
4. Check whether you’re getting the best deal on your bills
If your contract with your current supplier is coming to an end, think about shopping around for a better deal rather than simply renewing. Sites like Uswitch can help you compare prices and providers for gas and electricity, broadband, and insurance.
Don’t be afraid to haggle. If you find a better price than the one you’re getting with your current provider, you could contact them to let them know that you’re thinking of leaving and provide evidence of the deal you’ve found.
Providers won’t want to lose customers, and they could be willing to match or even better the quote. This won’t always be possible, but it’s certainly worth a shot, especially if you’re generally happy with your current provider’s service.
5. Switch up your shopping
Food is a necessity, but it takes up a large proportion of our monthly budget.
A single person in the UK spends an average of £136 on groceries per month. For two adults sharing a household, this rises to £291, while a family of four (two adults and two children) spend an average of £508 a month.
Fortunately, there are things you can do to cut back on the cost of your weekly food shop.
If you’re hoping to save money on a low income, swapping your supermarket could make a significant difference to your finances.
In 2024, Aldi was crowned Britain’s Cheapest Supermarket. In August 2025, Which? revealed that the average price of a 75-item shop at Aldi cost £127.92, compared to £139.42 at Asda, £142.36 at Tesco (with a Clubcard), and £144.75 at Sainsbury’s (with a Nectar card).
As well as switching your supermarket, you could also save money by buying own-label products rather than brands; making the most of yellow sticker discount finds; and shopping for seasonal produce.
6. Look into ways to boost your income
Did you know that almost 25% of people in the UK have a side hustle that brings in between £1 and £200 a month?
A side hustle is a job or hobby you do in addition to your main job. This could be anything from picking up some extra hours as a food delivery driver to utilising your baking skills and selling cakes.
A side hustle shouldn’t feel like a chore or something that takes up too much of your leisure or relaxation time. While earning some extra money is fantastic, it shouldn’t interfere with things like your main job, your rest, or the time you spend with your loved ones.
Interested in a side hustle and looking for some inspiration? Check out the CashLady guide to the best second jobs for extra income.
7. Sell unwanted items
Keen to save money on a low budget? Setting a morning aside to have a thorough spring clean can be an oddly satisfying task – and even more so if you can make it pay!
From clothes, shoes and accessories to toys, books, and general bric-a-brac, if your unwanted items are in decent condition, you could sell them on second-hand sites.
On popular selling app Vinted, there are no seller fees, and the buyer covers the cost of postage. This means that you’ll be paid the full amount of the sale.
8. Explore saving challenges – but don’t put pressure on yourself
Tried and tested saving challenges can be a great way to kickstart your savings journey, but it’s important to remember that the methods do not need to be set in stone. You may wish to adapt an existing savings challenge to suit your personal situation, or you might find it easier to come up with your own.
When it comes to saving money on a low income, it’s all about what works for you.
You can take a look at some well-known money-saving challenges in our blog.
9. Choose your savings account wisely
How do savings accounts work? Generally, you can pay in money as and when you like using online banking, cash, or a cheque, although some savings accounts may have a minimum or maximum amount of money that you’re able to deposit. You’ll earn interest on your balance, which will be paid either once a month or once a year, depending on your account’s terms and conditions.
There are many different types of savings and investment accounts on the market, and with so many options to consider, it can be difficult to choose where to put your money.
Ideally, you want to find a savings account that makes your money go further by paying a decent amount of interest.
An account comparison site could help you search for a suitable savings account.
10. Don’t be afraid to ask for help if you need it
Talking about money can feel awkward – but it shouldn’t be. If you’re struggling with your finances, please remember that money worries are common and can happen to anyone at any time.
If you’re not quite ready to open up to a loved one, you might find it easier to speak to somebody impartial in confidence. Charities and organisations such as StepChange, MoneyHelper, Citizens Advice, and National Debtline provide free money and debt management advice.
Summary: how to save money on a low income
It’s never too late to start saving.
Focus on your own goal and don’t feel disheartened by statistics in the media or the financial situations of friends and family. When you see headlines about how much the ‘average’ person has or ‘should have’ in savings, remember that these statistics reflect exactly that: an average. Many people will fall below this average. At the end of the day, our finances are as unique as we are, and it’s unfair to yourself to compare your circumstances to somebody else’s.
Saving £5 a month is better than saving nothing at all, and is still a brilliant achievement, especially given the current cost-of-living crisis.
When it comes to saving money on a low income, consistency is key, but that doesn’t mean that you should struggle to live. Don’t beat yourself up if you find that you’re unable to put as much or any money at all into savings one month.