Living modestly does not have to equate with a poor quality of life. It is possible to live contently on a modest income if you're smart and resourceful. Certain behaviors, mentalities and circumstances cause people to overspend, including impulsive buying and the desire to "keep up with the Joneses." Change your regular behaviors and make a life plan to live happily and successfully on a modest income.
Create a written budget to help you manage your money. Write down your monthly income along with your monthly expenses. If your income does not exceed your expenses you'll have to make cuts. Sort your bills from highest to lowest priority. Reduce or cut expenses at the bottom of your list.
Downgrade to a smaller space in a comfortable yet affordable neighborhood if you feel that you are living outside of your means. This will help you save on rental or mortgage costs as well as property taxes and maintenance expenses. Decorate your space with inexpensive and attractive items to make your new smaller house a relaxing home.
Pay yourself by saving money. If you work for an employer that offers retirement plans with matching contributions, have the money withdrawn from your checking to go toward saving. This will help give you peace of mind about your future.
Manage your money using cash instead of cards. Separate your cash into envelopes for the various everyday expenses you need to pay. For instance, take cash with you to do grocery and clothing shopping. Carrying the cash instead of a card helps you avoid going over your budget for these items.
Write grocery and shopping lists before you visit the store. Prioritize your list of needs just as you did your budget, write in the estimate cost for each item, and eliminate products at the bottom of the list.
Spend time with other people who are committed to responsible spending. This will help you avoid the "keeping up with the Joneses" syndrome that causes some people to overspend.
Treat yourself to one non-essential item each month to reward your new smart spending habits. For instance, a pair of modestly priced shoes or a dinner at an inexpensive restaurant.
Analyze each purchase before you even visit the store. If the cost does not fit into your written budget, and you do not have the cash to pay, you cannot afford it. Look for a less expensive alternative and think of the money you saved by making a more responsible spending decision.