by Maja Majewski

5 Habits to Help You Live Within Your Means

What does it really mean to live within your means? Is it possible for everyone--and is it a good goal to have? Here’s the 411.
Budgeting and Financial Responsibility

You’re probably familiar with the concept of living within your means: Basically, spending less than you’re making to avoid going into debt.

While it’s true that we should all aim to spend less than we make, it’s also true that this is significantly more difficult for some people than others. The realities of pay inequality, low minimum wages, and other socioeconomic factors make ‘getting ahead’ much harder for certain groups of people than others.

So when we talk about living within (one’s) means, it’s important to understand that there are many factors involved in each individual’s unique financial situation that can impact their ability to live within their means. That said, regardless of whether you’re just starting out, or you’re at the peak of your career, learning to live within your means is always a good goal to strive for.

For most of us, it’s easier said than done. We would all like to have some extra money at the end of each month, but keeping track of every penny can feel overwhelming. Try incorporating these money-saving habits into your life to make saving money just a part of your routine.

Track your spending

In the US in particular, it’s very easy to spend money you don’t have–like by putting a big purchase on a credit card when you don’t have the cash to cover it. Creating a budget and learning to only spend money that you have is an essential part of saving.

It allows you to see what’s coming in, what’s going out, and what you have leftover to spend and save.

Start simple. Subtract your known expenses from your income. Then, make sure you budget for variable expenses by looking over your recent bank account activity.

Establishing a habit of monitoring these variable expenses is the best way to see where your money is really going. Check to see what kind of expensive daily habits you’ve got yourself into—outside of the cliched espresso coffee charges. Are you also paying for parking or ridesharing too often? Are you eating out multiple times a week? Are you paying for multiple streaming services but only using one of them regularly?

While cutting these expenses out completely might not be realistic at first, try curbing your most expensive habits slowly, so you can learn how to adapt without feeling deprived.

Start keeping track of your Expenses with Simple!

Automate your bills

Setting up automatic payments for your recurring bills is a great habit to get into. You only have to set up the payments once and then you don’t have to remember to do it each month; it just happens automatically.

You can learn more about keeping track of your expenses with Simple in this blog.

In addition to automating your expenses, you can also automate your savings to help you work towards your financial goals. Here are a few banking and budgeting tools from Simple that help you automate your savings!

to save a little with every swipe… turn on Round-up Rules!
To save the same amount every time you get paid… set up a Goal with an automated Funding Schedule that aligns with your Direct Deposit!
To save the same amount every day… set up a Goal with an automated Funding Schedule to save a little every day!

Adopt a positive money mindset

Money often evokes negative emotions, something that is stressful and stops us from doing the things that we want to do. Change up your perspective by reminding yourself—money pays for your home, your food, your fun, and it can give you security and stability. Remember that money is your friend, not your enemy, and it can either open doors or close them. Adopting a positive money mindset can help you see more opportunities to save money in your daily life.

Ask yourself this question daily to train yourself to have a more positive mindset: How did money benefit me today?

Create spending barriers

Prone to impulse or emotional spending? Even if you have every intention to stick to your budget, impulsive purchases–like unplanned clothing purchases, impromptu drinks with friends, or the latest must-have video game, can quickly take you off track.

With online shopping available on your mobile device, it’s incredibly easy to spend money without really thinking about it. With just a tap, swipe, or fingerprint, you can blow your monthly budget in a matter of minutes without having to touch your wallet.

One of the easiest ways to curb impulsive spending is to create spending barriers: Create systems that require you to go through a few hoops before making a purchase.

Here are a few examples of spending barriers you can create to help you live within your means:

  • Delete any payment information that has been saved on your computer and phone, so you have to actually open your wallet to make online purchases.
  • If you see something in a store that you love, and it’s also available online, wait until you get home before buying it.
  • Have trouble sticking to your grocery list? Take advantage of the free in-store pickup that many grocery stores offer, so you can select exactly what you need online (and nothing more).
  • Going somewhere you’re prone to overspending? Bring cash and leave your cards at home so you have to stick to your budget.

Creating these kinds of systems will help you curb unintentional spending!

Prioritize your savings goals

Saving can become difficult when you only think about the things that you are denying yourself. Make saving much easier by instead focusing on what you are working towards—and then prioritizing those based on what you actually want.

If you’re a Simple customer, a good way to do this is to set Goals, like saving up for a holiday or paying off a car. This will make your goal seem more real, so you will be more motivated to stick with it.

Learn how to prioritize your savings goals here.

Note: As your ‘means’ change…

Ideally, as you grow in your career, your income will also rise. As you begin to see more money in your bank account, it’s very normal to start to loosen the reins on your spending a bit.

This is where the concept of ‘living within your means’ can start to be limiting: If your only financial goal is just to spend less than you make, then you can maintain a lot of poor financial habits while still achieving that goal. Living within your means certainly means something different when you’re making $35,000 and $150,000.

It’s important to continue to revisit, add, and build upon your financial goals whenever your situation changes to make sure that you’re doing what you can to make the most out of your money.

In summary, everyone is not on an even playing field when it comes to living within their means. But learning how to spend less than you make, so you can avoid going into debt, is a key first step in establishing financial stability. Be sure to continue to adjust your financial goals as you grow and make changes in your life!

Disclaimer: Hey! Welcome to our disclaimer. Here’s what you need to know to safely consume this blog post: Any outbound links in this post will take you away from, to external sites in the wilds of the internet; neither Simple nor our partner bank, BBVA USA, endorse any linked-to websites; and we didn’t pay/barter with/bribe anyone to appear in this post. And as much as we wish we could control the cost of things, any prices in this article are just estimates. Actual prices are up to retailers, manufacturers, and other people who’ve been granted magical powers over digits and dollar signs.