Living on one income certainly isn’t easy, especially if you have kids, but that doesn’t mean you can’t enjoy a high quality of life. The secret is to closely monitor your finances, think outside the box, and save money wherever you can – the following guide will help.

How to Live on One Income

Track your spending

You are little chance of saving money unless you can keep track of it all, so start tracking every cent! Apps such as Mint and BudgetSimple can certainly help, though even just writing down all your expenses in a book can be effective. Not only will this give you an accurate idea of exactly where all your money is going, you will be less likely to spend frivolously when you know you will have to account for it later on.

Target debts

Until you have eliminated your debts there is no point in adding to your savings, especially when your debts are accumulating interest faster than you can save. For best results, take aim at debts that have the highest rates of interest first, such credit cards and short term loans, and divert every spare dollar towards repayments until they are paid off.

Create an emergency fund

Living on one income can leave you vulnerable if an unexpected expense arises, but building up an emergency fund will mean you can avoid going into debt to deal with a crisis. Putting away even a few dollars each week can make a big difference over the course of 6 or 12 months and if you have the money taken out automatically you won’t even notice it.

Earn a little extra

There is no shortage of short term paid opportunities that can take some pressure off your budget. Whether you sell your photos on iStockPhoto, get paid for your opinions on SurveyCompare, or download apps like Swagbucks and make money playing games, you can make a surprising amount relatively quickly. You can also find well paid gigs doing everything from voice acting to editing right through to mystery shopping.

Trade your skills

Regardless of whether your specialty is painting, gardening, child care or pet sitting, trading your skills is a fantastic way to save money. Start by letting friends and family members know that you have skills or services to trade and advertise in your local online classifieds as well. Never underestimate what constitutes a tradeable skill, as some people may just need help with regular chores.

Find the best deals

Get into the habit of comparing prices before you make any purchase and you will be saving money in no time. Utilizing coupons on gas and grocery purchases can make a noticeable difference and price comparison sites can save you a fortune on everything from flights to insurance to washing machines. Always keep an eye out for sales, team up with friends to buy in bulk, and consider signing up for free memberships at stores you frequent regularly anyhow.

Tighten your belt

Start by cancelling subscriptions and memberships you rarely use and impose spending limits on luxury items such as clothing, alcohol and sweets. Watch DVDs at home rather than go to the cinema, restrict eating out to special occasions and consider spending your holidays a little closer to home. You can still treat yourself occasionally, just not all the time.

Living on one income requires careful planning and a committed effort, but it can honestly change your life. You will be amazed at just how far your money can stretch when you put your mind to it.