Living on a budget

Money Advice Service

Managing money and making ends meet when you’re on a low income takes careful organisation. So we’ve pulled together some of the best ways to make sure you’re using all the tricks in the book to help you stay in control when you’re on a tight budget.

Work out your budget

Use our Budget planner to work out how much money you have coming in and what you’re spending it on.

The first step to taking control of your money is working out your living costs, including knowing what’s coming in, what’s going out and when.

Making a budget gives you a clear picture of where your money goes and shows you where you might have a chance to save money.

It will also help you see whether you’re living within your means.

For more on budgeting and money management, read our Beginner’s guide to managing your money.

Look at ways to cut costs

Our Quick cash finder will help you see how you can save by cutting out non-essentials.

It can be difficult to increase the amount of money you have coming in, but you have much more control over what goes out.

Research from Santander says, UK households spend an average of £3,329 per year, on their:

  • water
  • energy
  • Council tax
  • electricity
  • broadband bills.

You can save hundreds of pounds by switching utility providers and shopping around for lots of things, including your groceries and holidays.

For more information read our guide on How to save money on household bills

Claim all the benefits you’re entitled to

It’s easier than you might think to check that you’re getting all the benefits you’re entitled to if you’re on a low income.

Some benefits are one-off payments to help with a particular set of circumstances like cold weather.

Others, such as Income Support, top up your regular income.

Follow the link below for an overview of what’s available and how to find out if you’re missing out.

Emergency borrowing to make ends meet

In some circumstances, you might be able to get an interest-free government loan to help you make ends meet at a difficult time.

Budgeting Loans

If you’re on a low income and claiming benefits you might be able to get an interest-free Budgeting Loan from the Social Fund.

This can help with things like:

  • travelling expenses
  • clothing or footwear
  • furniture or household equipment
  • money to help you look for or start work
  • improving, maintaining or securing your home
  • advance rent or removal expenses for a new home.
Find out about Budgeting Loans and get an application form on the GOV.UK website.

Learn more about the Budgeting loans and Budgeting Advances on Turn2us’ guide to What is a Budgeting Loan/Advance?.

Other loans

Be very careful with other kinds of borrowing.

Things like payday loans, log book loans and doorstep lending can seem an easy solution, but can make a bad situation worse.

They’re often a very expensive way of borrowing, so always try to find other ways.

Ask your family if they can help, or consider joining a credit union.

Credit unions offer banking services to people who would otherwise find them difficult to get.

This article is provided by the Money Advice Service.

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