How to Live Below Your Means Successfully?

How to Live Below Your Means Successfully?

Living below your means has a large number of advantages, primarily among them is no liability of loans and saving some portion of your income. This is the opposite of a pompous and showy lifestyle that, at times, forces a person to take loans and end up with no savings.  

Those who value money will always try to save money by living below their means. Leading simple yet fruitful life means you are creating a future buffer of money that may stand in good stead in times of need. This may help you avoid borrowing money. 

Living beyond the means cannot be justified by any means as it brings with it a host of serious problems including those of loans and lack of savings. This brings uncertainty to your future planning. Earnings must be spent judiciously. 

In fact, living within your means and curtailing expenditure on things that may not be essential can go a long way in helping a person in consolidating his or her financial base. The money thus saved may grow by accruing interest or dividends.

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Simple and Effective Ways to Live Below Your Means

Living below your means does not necessarily mean living miserly. It denotes valuing money and utilizing it on necessities by avoiding unnecessary expenditure on things that are not necessary for you. You can also adopt additional ways to live within your means and save money. 

Create a Budget:

This can act as an expenditure roadmap for you. Keeping your expenditure as per the monthly budget and sticking to it is one of the best ways to live within one’s means. It can help you to save money to meet future exigencies and emergencies. Besides, you are creating a balance between income and expenditure. 

Cut meaningless expenses:

Most of us spend money on many useful purchases. Such purchases may not be of much use to us yet we tend to buy them. To exemplify, you can avoid buying a shirt or trousers from a branded company dishing out a high amount whereas you can save a lot of cash by buying those items made locally yet serving the purpose. You may commute by bus or local train rather than spending a large sum of money on a taxi. 

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Start Saving:

Savings is the core of financial success. A small saving on daily basis can leave you with large cash at the end of the month. Thus, per day savings is very important. 

Live off one income:

If you want to protect your financial future, this is one of the best ways for it. Don’t just spend your month’s total earnings. Keep a part of it untouched. This can go a long way in helping you build your future cash reserve which may be utilized for productive purposes. 

Pick Up a Second Form of Income:

Side income is always preferable for all. You may invest in shares or bonds that will generate income. You may rent out your home if you happen to have two living homes. This will yield your monthly rent. Thus, the additional income or second form of earning can be very much useful to you. 

Downsize your home:

You can save a lot of money by living in a smaller apartment. If you are living in a large home, this directly means you are paying a lot of money for rent. If that larger home is your own, you would have to spend additional money for the maintenance. This, however, may not be an ideal situation as you are spending money that can be saved by moving into a small rented house or buying a smaller apartment. This can help you in living within your means. Additionally, you are saving money every month that might have gone for maintenance of a larger hoe. 

Drive used vehicles:

A person can save considerable money by going in for driving used cars. To buy a brand new car directly means spending a huge amount of liquid cash. Whereas, this additional money can be saved by buying a second-hand car. Practically speaking, a brand new car and a previously owned car have to save utility. The purpose of a new car and a used one is the same. Hence, you can jolly well drive a used car rather than paying a large amount to own a brand new one. A car is primarily meant for commutation. That is its sole purpose. Hence, if you can save a large amount of money by driving a used one, what is wrong with it? Consider this question.  

Pay less interest:

It is always prudent to save money by paying a small amount as interest on the use of your credit cards. To live within your means, you should always consider avoiding high-interest credit cards. Servicing such high-interest credit cards means you have to pay a higher amount of cash as interest. Hence, it is always beneficial to pay the interest on credit cards timely to avoid default thus paying a penalty. At the same time, you should also avoid going in for high-interest credit cards. 

Don’t Rely on Credit Cards:

Credit card is an important and useful banking instrument that can help people greatly. But one should avoid the daily or regular use of credit cards. In fact, should never be made a habit to flash your credit card in making purchases. It makes you prone to spend money unnecessarily. Just rein it for your own benefit. If you have cash in your pocket, prefer spending it on your purchases as using credit cards (instead of cash) means paying interest. This interest payment is an additional financial burden to you. Hence, avoid it to the extent possible. 

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Negotiate Rates and Bills:

Bargaining had been continuing since time immemorial. Why not act wise by following it? If you negotiate on prices, you can have the cost reduced. Money saved is money earned. Thus, in shopping for vegetables, if you can negotiate on rates, you are saving money. You can also prefer discount shopping that enables you to save money. 

Track Your Spending:

Untracked spending is not preferable at all. A wise person will always keep an account of the day’s spending. They will track on which heads they spent money in a single day. This helps them track their spending and also enables them to live within their means. 

Pay yourself:

This is a very wise way to live within your means and also save money. In a single month, we all spend money on several heads like gas bills, electricity bills and many others. Similarly, make it a strict rule to save little cash on the head of Pay Yourself. This means you are also paying yourself just as you pay for your various needs. This is a very good personal habit. This may benefit you at the end of the year when you sum total the money saved by Paying Yourself. 


We, by nature, spend money on a large number of things that may not be necessary for us. But we are spending cash on such items. Here, one must rein himself or herself. This can happen only when you are living within your means. 

At a time when the cost of living is rising every passing month, it is wise to be a prudent spender. A prudent spender spends below his or her earnings, thus saving money for future use.


TheLiveCash is a team of experts in finance and banking. We are striving together to bring financial clarity to readers across the world. We write about savings, making and budgeting money, investing, taxes, loans, and all other financial topics.