11 ways to manage your household finances on a small salary

11 ways to manage your household finances on a small salary
11 ways to manage your household finances on a small salary

The size of your paycheck often affects how you manage it to avoid financial shortfalls. Especially if your paycheck is a fixed income, that is, a fixed monthly salary, and your subsistence needs often fluctuate.
Low-wage earners will find it difficult to set aside money for various things such as: emergency funds, college tuition, retirement funds, car purchases, etc.

It is not uncommon for the money to run out in the middle of the month. This may happen because they are unable to adequately manage their monthly paycheck to meet the financial needs of the family. In addition, each family should have plans for the future, such as: vacations, their own house and car, their children’s college education, and retirement funds. These plans are expensive and it is not easy to find additional income.
Therefore, you need to know some ways to manage your household finances on a small salary to make your plans come true.

You shouldn’t get angry or frustrated about a small salary, the priority is to be grateful and manage your paycheck properly. Check out Cermati.com’s overview of 12 ways to manage your household finances on a small salary.

11 ways to manage your household finances on a small salary

1. Estimated fee/housing payment.

Many people find it difficult to manage their family finances because home (mortgage) payments have cut a large portion of their monthly paycheck. It is recommended that the mortgage loan does not exceed 25% of the total salary received each month.

Tips: Look for mortgages that offer the lowest payments, or if you can’t afford a mortgage, look for cheap rent. There must be deals that you can afford. The key is to keep looking for information.

If you own your own home, you can set aside a portion of your salary for savings or investments. If you are single, you can rent a room in your house to 1 or 2 friends. The money you earn from renting your room can help you lower your mortgage payments and is a good way to invest. That way, you can pay off your mortgage and set aside some money for other investments, like savings and an emergency fund.

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2. Properly plan your monthly purchases.

Financial spending tends to occur when you use money for your wants, even though wants are not necessarily needs. The best way to use up some income is to make a monthly spending plan with a written budget.

Spend the money according to the plan you make. When you buy what you need, you will already have a budget for your purchases. However, do not spend more than you budgeted because the money left over has been used for other needs.
Tip: Plan your monthly budget in writing, dividing your list of expenses into two parts: primary needs and tertiary needs.

Primary needs include: food, transportation, electricity, water and telephone bills, house, motorcycle and car payments, among others. Tertiary needs include: a budget for clothing, travel, and a budget to socialize with friends or co-workers.

Planning your shopping list is very effective because by buying in bulk, prices will be much cheaper, so you can save more on food and have more savings. In addition to getting into the habit of making a monthly shopping budget, you should also stick to whatever financial budget you make.

3. Buy items you can still buy

Buying things you can still use can save your budget, like: used cars, used electronics, used furniture, etc. Lots of people offer cheap deals on used items that are rarely used, and some have never been used at all.

Sometimes you can find an item whose box has been opened, but the item inside has never been used, but it is not selling for the price of a new item because the packaging has been opened. There are many online stores that offer these used items, you need to be diligent when looking for them online.
Tips: Buying used items that can still be used, or used items in like-new condition, will really help you save money. For example, for families that have just moved and need furniture such as: tables, chairs and other household furniture.

It’s best to buy still-good used items from thrift stores, flea markets, or online stores, but don’t forget to haggle. With a little spray paint, used tables and chairs will look like new.

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4. have automatic temperature control

Automatic temperature control can help you save money, making it easy to save money. Choose an air conditioner with the lowest energy consumption temperature control, so you can save energy and money, even if the purchase price is a little higher than a conventional model.
Tip: Even if it’s scheduled automatically, you can still manually change the temperature in your home as you see fit. An advanced climate control detects when the owner is not home, so it automatically reduces energy consumption, which is more efficient. Although they are a bit more expensive, they are more energy efficient and more durable. Nowadays, many air conditioners are automatically designed according to the required power.

5. Use credit cards wisely

Buying with a credit card is easy and you can buy anything. Credit cards can help you manage your finances if you use them wisely, for example: use the promotions provided to buy the items you need.
But credit cards can also land you in long-term debt if you use them carelessly. Studies have shown that credit cards are the easiest way to spend money, because in addition to the amount of money spent, interest and administrative fees are also charged.

Tip: If you can’t control your credit cards, it’s best to forget about them if you want to save money. The habit of using credit cards carelessly will waste money and lead to serious financial consequences, so don’t let your household get into trouble with credit card debt.

6. save costs on multiple activities

You can do several activities at once to save on expenses, such as: buying lunch while running errands outside the office. This will save you more gas than making several inefficient trips.
Tip: Set aside the difference regularly in your savings account. Even if you live close to your workplace, you can have lunch and coffee at home. There is always a way to save money to save, depending on yourself.

7. Drive less.

You can walk, bike, or take public transportation instead of driving your car to the store or work.
Tip: You can save money on fuel and also have the added benefit of a healthier body by exercising more.

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8. Look for extra income.

Use your free time to look for extra income. There are many ways to earn additional income, such as selling loans, working as a freelance writer, selling online, etc., as long as it doesn’t interfere with your main job. The more extra income you have, the more salary you can set aside to save.

9. Cut back on eating out or online food ordering

Eating out at restaurants and ordering food online from time to time is fine, but if it becomes a regular habit, it will quickly eat up your paycheck.
Restaurant food costs at least 4 times more than home cooked food. Not to mention, if you often order food online, of course your food costs will go up.
Tip: If you want to save money, cook your own meals at home. Try to eat at restaurants or order food online (Go Food or Grab Food) only occasionally, not every day. Do this and see how much money you can save by cooking for yourself.

10. Use PayLater wisely.

When it comes to meeting household needs, PayLater is nothing new. The ease of getting money loans online through credit applications or e-commerce can make you forget.
Make sure you use paylater wisely, not for consumer needs or use paylater because you want to buy instead of important needs. You have to understand that paying off debts is the same as having debts, you still have to pay them off and try not to fall behind in paying off debts.

11. Choose a data plan and use internet data sparingly

Internet has become a basic need for Indonesians. Especially now that everything is online, be it work, business or school/education, everything is done online.
You will definitely need an internet data package or WiFi connection at home. To save money, try to choose an Internet or WiFi data package that suits your needs at a price that fits your budget.