10 Ways to Save Money When You’re Making Minimum Wage

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Last month, Money Talks News posted an article about how to save $1,000 by summer. It was packed with good ideas, but as one commenter mentioned, the list seemed mostly geared toward those making middle-class incomes.

What about those of you squeaking by on minimum wage? Is there any hope for you to get money into savings? After all, working full time on the federal minimum wage brings in a whopping $15,080 a year before any taxes.

You only wish you had money for a monthly latte, let alone a daily one. And a gym membership? Please.

So let’s assume you’ve already got your budget down to bare bones: You’re reading this article on the library computer because there is no Internet at home, cable has been cut, and you have the thermostat set to slightly above freezing.

What else can you do? Here are 10 ideas worth considering:

1. Get out of debt

If you’re only making minimum wage, you can’t afford to be sending money to a car financing company, Visa, MasterCard or Discover.

Think about it this way: If you had no house payment, no car payment and no credit card payment, what’s left? The only bills you may need to pay would be utilities, taxes, insurance, gasoline for your car and food for yourself. In many areas of the country, you could do that on $15,000 a year.

Now, housing is a major problem, I know. On your income, it might be easier to sprout wings and fly to Paris than own a home without a mortgage. We’ll talk a little more about affordable housing options in a minute, but for everything else in your life, make living debt-free a priority.

2. Hoard gifts of money, tax refunds and other windfalls

To get out of debt and build up your savings, you need to make smart use of all those times you run into a little extra cash.

If you make minimum wage and have children, chances are you’re entitled to the Earned Income Tax Credit. That could mean you get thousands of dollars from Uncle Sam each year. What are you going to do with it?

You might be eyeing the ripped couch in the living room and thinking it would be nice to have it replaced. Or maybe you’d like to buy the kids new bikes or even take a trip somewhere.

Until you get on firm financial ground, resist the urge to spend those windfalls. Put a couple hundred in the bank as an emergency fund and ship the rest off to your creditors. If you’re debt-free (hooray!), bank at least half of it before you think about spending a cent.

Do the same with other unexpected money, whether it’s the $5 you find in the parking lot or the $50 your aunt puts in your birthday card.

3. Save your pennies

Literally. Start a change jar and put your coins into it every night. At the end of the month, roll up the coins and put them in a savings account.

You won’t retire rich off the money you collect, but you could end up with $10 or $20 a month to pad your savings account. That’s not much, but when you’re making $7.25 an hour, every little bit helps.

4. Skip processed food

Although I have never lived on minimum wage, I know all too well the feeling of barely scraping by. When you’re living that close to the edge, I realize sometimes you want to be able to open a box and cook dinner or swing through the drive-thru for the dollar menu. After all, life is hard; can’t one thing be easy?

It may be tempting, but you’ll feel better and save money on health care costs in the long run if you say goodbye to the canned, boxed and frozen meals. If you need some menu inspiration, check out budget cookbooks from your local library. “Family Feasts for $75 a Week” and “The $5 Dinner Mom Cookbook” are two you may find worth reading.

5. Park the car

After housing, your car is probably your biggest money pit. You need to pay for insurance, registration and gas, plus you might even have a monthly payment on it.

You’ll free up tons of money in your budget if you can get rid of your car or at least drive it less often. Depending on where you live and your personal situation, you may be able to do one of the following:

  • Sell the car and use public transportation exclusively.
  • If you’re a two-car family, sell one vehicle. If both adults in the house work, see if you can get opposite shifts or find jobs close to one another so you can drive together.
  • If you have years left on a vehicle loan, sell the car and buy a cheaper one. If you owe more than it’s worth, consider using your tax refund to pay down the balance so you can unload the car and its payment.
  • Carpool with a co-worker or friend and split the car costs.
  • Combine errands and appointments to minimize gas and parking costs.

6. Rethink child care

Child care is crazy expensive. If you have two income earners in your house and you are both making minimum wage, you might actually come out ahead if one adult stays home with the kids. Not only will that eliminate day care, you’ll also save on gas and other work-related expenses.

If that’s not possible, read this article about other ways to lower child care costs.

7. Sell what you can

Get serious about saving by scrutinizing everything you own.

You could have a yard sale to sell old clothes, trinkets and kitchen gadgets, but think bigger. Sell the furniture you don’t need. Sell your movie collection. Sell the TV. I’m serious! The kids will find something else to do.

Having to sell your stuff may seem rotten, but if you put that money into savings, it can be incredibly freeing. It’s a great feeling to know that if the car dies on the road, you have money in the bank and won’t need to frantically call friends to help pay for a tow.

8. Find a roommate

Let’s go back to the housing problem we mentioned earlier. Let’s face it: Finding affordable housing can be a nightmare. Subsidized housing is available, but wait lists are long and the properties aren’t always in ideal locations.

If you can’t find a place with cheap rent, the next best thing may be to get a roommate. Another option might be to rent out a room if you are in a house. Either way, you get a break on your monthly payment as well as on the utilities.

You can find potential roommates on websites like Roommates.com and EasyRoommate.com. Sites like Craigslist or your local paper may be good places to place ads if you have a room to rent.

Regardless of how you find a roommate or renter, be sure to double-check their references. A background check, obtained through your local police department, may cost a few dollars but can be worth the peace of mind. Make sure you’re not letting anyone potentially dangerous in your home, especially if you have children.

9. Move somewhere cheaper

Maybe despite your best efforts, you simply can’t find an inexpensive place to live. In that case, it may be time to do something radical. You may want to move to a new city or a state with a lower cost of living.

That isn’t permission to simply pack up and go without a place to stay or a plan for what to do when you get there. Instead, do your research first and line up a job in advance.

10. Make more money

Finally, if none of these suggestions sound like much fun, it’s because it’s really hard to get by on very little income. You know that.

To make more money, you could work harder or you could work smarter. Choose the second option. Rather than spending your life working two or even three jobs to get by, get the right education and training for a career that will let you live comfortably.

Look at these jobs that require only a two-year associate degree. According to the Bureau of Labor Statistics, these are some of the fastest growing jobs in the country. The incomes listed are the median wages earned by workers in these occupations in 2012.

  • Dental hygienists — $70,210.
  • Diagnostic medical sonographers — $65,860.
  • Web developers — $62,500.
  • Occupational therapy assistants — $53,240.
  • Physical therapy assistants — $52,160.

Wouldn’t it be nice to be making $50,000 or $60,000 two years from now? It’s not a pipe dream. You can do this.

Talk to your local community college to find out which careers are in demand in your area. Their financial aid office should also be able to help you learn about programs that can pay for your tuition and eliminate the need to take out student loans.

Those are 10 ways to maximize your money when you are living on next to nothing. Let us know what you think about these suggestions in the comments below or on our Facebook page.

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Comments & discussion

We welcome your opinions, but let’s keep it civil. Like many businesses, we reserve the right to refuse service to anyone. In our case, that means those who communicate by name-calling, racism, using words designed to hurt others or generally acting like an uninformed bully. Also, comments that include links to email addresses or commercial websites typically aren't posted. This isn't a place to advertise your business.

  • Charity

    First, I love this column and read it weekly. Not to be disrespectful, but this writer obviously has never made minimum wage and these tips are not realistic for those of us who do. Yeah, I do read this often because I need to save mone, but, eight of these ten tips are unrealistic and, frankly, insulting for those of us who live below the poverty line. Moving to a new place is generally not an option when you are poor with children – unless you have relatives somewhere who can help. Sometimes processed food and canned food is necessary when you are trying to stretch a dollar and feed your family. Even though a car is costly, the bus is not an option for where I live and for others that might have to use a car for work, shopping, etc.. A roommate might be great in theory, but impossible for my current living situation. The “get out of debt” suggestion is what (I) we live for but not possible most of the time. The bills ALWAYS outnumber the pay. I find that people who make more and live a little better never remember what it was like to live with less. it is a constant headache and struggle everday. I save what I can and do without most of the time. Please think first before putting comments like this out there and consider that there are large groups of people in this country who are frugal and trying to do the right thing but are still part of the working poor. As I said, no disrespect intended.

  • Delores Mercer

    Charity, I hear what you are saying. I was a case manager for Family Services before I retired. I worked mostly with young women who had children and needed help in becoming self sufficent. Most of those I worked with were like you, they did the best they could and tried very hard. We live in a rural community so public transportation is not available. These young woman had many obstacles. They had to be looking for work, and many times had no one to watch their children while they did job search. Many had no vehicle, so they had to ask others to drive them, or walk. Even when they had a job, they had the responsibility of getting their children to a babysitter or day care, which usually meant taking them to a daycare setting and to a babysitter (more than one stop before going to work) . As I said many did not have their own form of transporation, yet they had to get the children to other places, and then get themselves to work on time, which was no easy feat. Many did not have telephones and if they had a sick child, or another situation where they could not go to work, they could not leave a sick child to go to the nearest neighbor with a phone, and ask to use it. If they didn’t call in to work, of course, they would lose their jobs. Some of my clients did not have the kind of clothes needed for work. They did not always have necessities they needed, such as an alarm clock. I am just saying that many people think these young woman are lazy and don’t want to work. This is not the norm. I don’t think any of them thought when they were little, “When I grow up I want to have kids and raise them on Welfare.” Yet in life, whether through their own fault or not, they were in various situations where they really needed a hand up and lots of encouragement. . Some of them didn’t have role models in their lives that taught them by example what it was to be a productive citizen to society. They pushed on and did the best they could and want a better future for their children. Some faced things themselves as children that no child should have to face. Just saying that some people do not realize what these young women (and sometimes men), go through, trying to do the best they can for their children. — Delores M.

  • Bonnie Hale

    I am so happy my Mother taught me how to save money. I see some friends with very low income, and they don’t seem to understand the principles of using coupons, buy what’s on sale, or getting the children to be less picky about what they will eat. If they are old enough to understand the concept of having to do more with less, then eating something different might be an option. I also scan the reduced goods baskets, reduced bakery , reduced meats, you name it. Ask friends with gardens if they have too much of something if you can have some. Usually they are happy to share.

  • Evan Sanders

    Item #1 clarification: File for bankruptcy and free yourself of debt. The purpose of bankruptcy is to allow people to make a fresh start. The philosophy that drives bankruptcy laws flies in the face of Victorian era “debtor’s prisons” where a person in debt could never free themselves of past indiscretions and make a new start, leaving many good people who could have made a difference in the world, instead rotting in debtor’s prisons for decades. There are no taxes on forgiven revolving and mortgage debt from bankruptcy (see a bankruptcy attorney for specifics on your situation, and there are attorneys who serve those in poverty).

    Next, after getting that monkey off your back, do everything humanly possible to never get into debt again, and follow the advice in the article. Claw your way out of poverty even if the ordeal kills you, because there is no life in the dark place where you feel so hopelessly trapped. If you were stranded in the wilderness, you would die trying to get out, instead of laying down to die. Treat your situation like that, because you might as well be stranded in the wilderness, and with determination and faith, you can escape your fate. (And for many, by the way, bankruptcy is the helicopter ride to safety for those who otherwise might have died from the elements.)

  • Deborah Park

    Are you kidding me? Who wouldn’t have thought of these things on there own? The last one, Make More Money, really cracked me up.