How to Budget when you don’t make enough money

Published on March 21, 2017 by Lauren

Many people have been trying to answer the question of How to Budget when you don't make enough moneyIt's a difficult place to be in for sure. But just because you don't make enough money to cover your expenses right now doesn't mean you have to throw up your hands in defeat. you can get through this! Here's how to budget in this situation.


You lose your job. You get sick. Your husband loses his job. You are going through a divorce.

These are huge life-altering challenges with relational, emotional and financial implications. Often, the result is a situation where you don't have enough money to pay the bills. Talk about things that keep you up at night… we've been there.

To describe the situation as ‘unfortunate' is quite the understatement. More like “drowning without a life vest”. 76% of Americans are living paycheck-to-paycheck today (source), and just one event could cause a financial panic.

Or maybe there was no single event that resulted in your financial situation – it's just been the accumulation of increasing bills and a paycheck that hasn't kept pace.

Whatever the reason – not making enough money to pay your bills is a HUGE problem facing many Americans today – so what can you do to keep it from becoming an all-out financial crisis?

I'm speaking from experience because I've been in $40,000 worth of debt and also got out of it (read more about it in my book The Recovering Spender).

How to budget when you don't make enough money:

1.) Keep a positive mindset

This is the hardest one, but also the most important. Negativity is attacking you from every direction.

Thoughts like:

You will never get out of this mess

You will never find a job

You will lose your home

These thoughts will become a self-fulfilling prophesy if you give into them. And I'm saying this as a person who struggles with negative self-talk – it is a KILLER.

I use my faith to remain positive, and you have to find what works for you. If you are able to stay positive and focused on what you need to do to get out of your situation, then reality will follow that positivity.

Stop wondering how to budget when you don't make enough money, and start believing and acting in faith.

How to budget when you don't make enough money

2.) Recognize that it is temporary

Yes, this is bullet number 2, and you might be thinking ‘2 points in, and nothing actionable?' This is on purpose.

The actionable items below won't stick if you don't keep your head in the game. You need to act knowing that your financial situation will not last forever and that it is simply a challenge that you have to overcome.

Do not let this become your lifestyle – choose to be an overcomer instead of a casualty.

But the only way that it is going to be temporary is if you TAKE IT SERIOUSLY! Financially speaking, you need to SPRINT! But just like in running, you can't sprint forever.

So make your sprint count!

3.) Cut, cut, cut

Are you paying for cable? Use one of these cheaper alternatives to cable instead.

Do you have smartphones? Sell them and reduce your wireless bill by using Republic Wireless.

Do you meal plan and use coupons?

Do you still go out to eat often? Here's a list of 13 things that you shouldn't be spending money on, so use this as a good place to start.

I remember a time when we couldn't pay our bills, I thought “well, what's the point of budgeting?” That line of thinking was a huge mistake.

Budgeting is more important than ever when you are running a deficit – you've got to drill down and figure out every single place that you can save money.

4.) Get More Money!

When you are running a monthly deficit in your budget, you have to attack this from both sides. Cut expenses and make more money.

Yes, yes, I know. Easier said than done. But there are some things you can do from home and make extra money that you might not have thought of.

What if you were able to cut $300 from your monthly bills, and then also make an extra $300 through odd jobs or working from home? That's $600 more in your pocket.

Can you work more hours at your job? Can your spouse go out and get another job or one of those side hustles?

When you are in survival mode, no job should be beneath you, and any sacrifices you make are temporary because you are digging yourself out.

If you had been laid off from a good-paying white collar desk job, it's ok to deliver pizza for a while before you land that next job.

how to budget when you don't make enough money

5.) Prioritize your bills

When there isn't enough money to go around, how do you decide who gets paid and who doesn't? Since we've been using the term “survival”, think of the things you would need to survive – food, shelter, clothing, transportation, energy… you're first payments have to be the ones that keep you in your warm home, keep food on the table, and allow you to get to work.

After that, you need to figure out what creditors get paid, and which don't. If you don't have enough to pay some creditors, make sure to communicate with them. You can negotiate your delinquent debt, and this might be the time to do it. But there are implications when settling debt, so be careful and make sure to do your research.

And filing for bankruptcy is NOT the easy way out that you might think it is.

Once you do all these things and finally see that light at the end of the tunnel, the key is to make those changes stick! And that might be the hardest part of this. to truly make them stick, you've got to make sure to track your spending. And to do this, I highly recommend a new company called Tiller. It's brilliant… all of your bank account transactions are downloaded daily to a google sheet. And you can track any way that you want to. Sign up for Tiller HERE.

In closing, here's why I made the first 2 points mental rather than actionable – would you be willing to work those extra hours, to get rid of your smartphone, to take a job that might seem embarrassing, if you didn't have a positive mindset?

Would you have the energy to keep going, to keep trying if you weren't in sprint mode?

When I was facing a $1,000 monthly deficit in our budget, I immediately went out and found a waitressing job. And it SUCKED.

But it only lasted for about 10 months.

I got myself to a point where I could make it without me working there. And I was stronger on the other side of it… and you will be too!

The question we have for you today is what are you willing to do to make this happen?

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