Being a money-saving expert has always guided me through the tough times.

It sure doesn't mean I'm rich, but I know a few things that I have picked up here and there.

Having a savings account when the money dry's up is like finding a pot of gold when you are starving. It becomes a warm blanket at night and helps you go to sleep a little easier.

It is really nice to have a savings account full of money when you really need it. But how do you save money and put it into the savings account when you are on a tight budget? This is why it is important to have a money savings expert to show you the way.

The first thing to do is write out your expenses.

Start with your rent or mortgage and go from there. It is really important to be as thorough as possible. Don't miss a thing. Here is a list of expenses that you might have.

  • Mortgage or rent
  • Car Payment
  • Electric
  • Water
  • Heat
  • Phone
  • Food
  • Clothes
  • Babysitter
  • Gas
  • Entertainment
  • Loans
  • Credit Card Payments

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Make sure to be honest about the expenses. Tracking what you spend is the most important part of savings on a tight budget.

The next thing to do is make a short income statement.

Take your income and subtract all your expenses and that will give you what you have left over at the end of the month. If your finances are tight, this number may not be very much.

Actually, the number may be non-existent. That is not a problem. We will work on that.

Your Number

Now that we have your number, we need to decide what amount we are going to save. The rule of thumb when having a savings is to have 3 to 6 months of savings.

A month of savings equals a month of income.

So if you have an income of $100 a month, then a month of savings would be $100. Let's say that your expenses are $80. That includes food, bills, entertainment, etc. The question that usually arises is "Do I have to have $100 dollars or just $80 since that is my expenses?"

We will get to that in a bit. For now, just know that a month's savings equals a month's income.

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Your Total Expenses

Earlier I asked you to write down all of your expenses. The question is, did you really write down all of them?

Let me explain. Your expenses also include your savings. What is that you say? That doesn't make sense. In order to save money it must be taken out of your hands and put on auto pilot.

We do that by adding it to our expense column. That way the money never gets in our hands and goes straight into our savings account.

So make the adjustments to your expenses above and add savings.

How to Squeeze Out Savings

Look at your expenses and pick one thing that you are spending money on that possibly could be cut. An example might be your cell phone bill.

If you are signed up for unlimited texting and calls, etc. it may be time to cut that down.

We are not losing that money we are cutting, we are just shifting it to another place. Here is a nice book that I have read and will help with finding areas to cut and save.

It is important to note that this is only temporary. Most people worry that they will never have the things they want because they are putting their money somewhere else.

Think of your savings as a short-term project that will be over once you get to your goal.

Is That It?

If you have tapped out your expenses and have no money left over to save then it may be time to look at bringing in more income.

There are so many ways to make more money these days and you don't even have to leave your home.