Budgeting on a Fixed Income

How to Budget on a Fixed Income

Whether you’re on a fixed income or a tight budget, sustain your quality of living despite the climbing cost of living with these real-life tips on budgeting and spending.

  1. Get Help From Experts – When you're on a fixed income, the first thing you need to do is to get a clear look at your finances. BECU can help. Our Financial Health Check specialists advise BECU members to create a budget that tracks monthly spending, and to check it often throughout the month, online or in our mobile app, so what you budget aligns with what you spend. Reviewing your budget and monthly expenses allows you to adjust, add or remove budget items. BECU provides helpful budgeting tools that do the heavy lifting for you.

  2. Pay Down Your Debt – If you aren't already taken steps to reduce your debt, now is the time. While there are many tactics for getting out of the red, the goal is the same. Once you've paid down your debt, more of your fixed income goes to covering living costs, and less to high-interest credit cards and other forms of debt-traps.

  3.  Trim Your Housing Costs - Own property? You're most likely seeing property taxes increase. Depending on where you live, you may qualify for property-tax relief. According to the King County Assessor's website, only 1 in 100 of eligible seniors and disabled persons are currently enrolled. As a renter, you still feel those taxes hit your wallet with increasing rent hikes. If you don't have a roommate, consider finding one. For some BECU members, finding a roommate is a successful tactic for reducing their monthly living expenses.
     
    If a roommate is not an option, consider moving to a more affordable neighborhood. Be sure to consider the cost of travel to work and other obligations, and whether it will offset the savings in rent.

  4. Reexamine Your Transportation Needs - If you have obligations that require a vehicle, there are multiple ways to reduce expenses by trimming your transportation costs: eliminating a car payment by buying outright a less-expensive car; swapping a fuel-hungry vehicle for a fuel-efficient vehicle; opting for a car-sharing program. It's also a great idea to take the time to shop around for auto insurance – are you still receiving a fair price for the right amount of coverage?

    Research what public transportation options are viable. You may want to sell your vehicle and use some of the money to invest in a bicycle as part of your transition. Every dollar freed up can go to other essentials and keep you on budget.

  5.  Manage Your Healthcare Costs - The best way to save on medical costs is prevention: Individuals who take preventative measures, such as doctor visits and abiding by recommended regimens, can save hundreds, if not thousands. The important step is to talk to your healthcare provider sooner rather than later.

    You can also save in unique ways: find a reputable dental school for dental appointments; vaccinate for the flu well before the winter months; fulfill your prescriptions at bulk warehouse clubs (often you don't need a paid membership to use their pharmacy service).

  6. Limit Eating Out - The rising cost of groceries is nothing compared to spendy pre-made meals and take-out. Check out handy online recipe sites, then head to your favorite entertainment service – YouTube, Netflix, cable network channels, you name it – and you'll find a cooking show for pretty much every type of personality and dish.

    If you love the outdoors and have a bit of greenspace, or access to a public p-patch, invest in gardening. The sweat equity results in delicious, fresh and affordable fruits and vegetables for your household.

  7. Monitor Your Progress - Once you have your budget set and you've adjusted your monthly expenses, now it's time to review your progress. Luckily, BECU has simple tools like recurring payments, our mobile app, and the BECU Money Manager, all which give you a clear view of how you're tracking against your financial goals.

  8. Get Free Advice - For additional tips and an in-depth review of your budget, we recommend scheduling a free a session with our Financial Health Check Specialists. They're like a life coach for your finances—all done conveniently over the phone. What's more, it's free for BECU members.