Living on a tight budget of $2000 a month is a reality for many people around the world. Whether you’re a student trying to make ends meet, a single parent, or someone looking to save money, learning how to live within your means is a valuable life skill.
From budgeting your expenses to finding creative ways to save money, I’ll provide you with a roadmap for living comfortably on a limited income. So, whether you’re looking to pay off debt, save for a rainy day, or simply live a more frugal lifestyle, keep reading for ways to stretch your dollar further.
Can You Live on $2000 a Month?
Yes, it is possible to live on $2000 a month. But, it depends on several factors such as the cost of living in your area, your lifestyle, and expenses.
High expenses, such as supporting dependents, paying for medical bills, or living in an expensive city, can make it difficult to live on $2000 a month. However, with the right circ*mstances, a modest lifestyle and careful budgeting, it is possible to live on $2000 a month in some areas.
How to Budget $2000 a Month
Creating a budget is crucial if you’re a beginner to frugal living.
When you’re first starting out, it’s important to keep close tabs on your expenses. That way you aren’t met with any surprises at the end of the month. There’s nothing worse than needing to pay rent and realizing that you’ve spent your rent money on groceries without realizing it.
Over time, you’ll know approximately how much you can spend on certain things and won’t need to be so structured! But as a beginner, sticking to a budget will be critical to your success.
Below is a breakdown of how to budget on $2000 a month:
- Rent: $850
- Groceries: $250
- Cellphone: $60
- Electricity/Water/Gas: $250
- Health Care: $31
- Public Transportation: $100
- Entertainment: $209
Total Expenses: $1750
You may be thinking, aren’t we budgeting for $2000 a month? Why are the total expenses only $1750?
Well, by following this budget, you can even save $250 a month while living on $2000 a month. How great is that?!
Do you want to up your budgeting game? Learn how to use the 50/30/20 budget method and download a FREE downloadable template!
10 Tips to Comfortably Live on $2000 a Month
Sticking to the $2000 monthly budget above is easier said than done. It’ll require you to cut costs on your daily expenses and live a frugal lifestyle.
Let’s dive into 10 practical tips for living comfortably on $2000 a month!
1. Extinguish Your Fuel Costs
As you can tell from the budget tracker above, I don’t spend any money on car insurance, car payments, or gas. But you know what I do spend money on? Public transportation.
Between riding my bike, using public transportation and asking my friends for the occasional ride, I’ve been able to live without a car for years.
Cutting out this expense has saved me hundreds of dollars a month. Plus, living car-free is easier now than ever before!
Below are some quick tips for living car-free without sacrificing comfort or freedom:
1. Work remotely
Since the pandemic, more and more companies have started offering remote work to their employees.
These opportunities are no longer reserved for entrepreneurs, self-proclaimed ‘digital nomads’ and social media influencers either. Companies like Google, Salesforce and Amazon are offering remote work opportunities!
Having to get to work is the most common reason for owning a car. Working remotely means you’ll never have to commute to work again!
2. Get your groceries delivered right to your door
When I sold my car, one of the things I was most worried about was grocery shopping. How would I transport my groceries without a car?!
I didn’t want to have to carry my groceries onto a bus and I didn’t think I could bike home with them either.
That’s why grocery delivery services changed the game for me!
Most grocery store chains will deliver your groceries to your front door for a small fee. There are also grocery delivery apps like Instacart and GoPuff that you can use!
3. Rideshare when you need to
Just because you don’t own a car doesn’t mean you’ll never need one. If you find yourself in a position where you need to drive somewhere, use a ride share app like Lyft or Uber!
Using a ride share app a few times a month is much cheaper than paying for car insurance and maintenance.
2. Lock in Your Natural Gas Rate
Locking in your natural gas rate is an excellent way to save money. By securing a fixed-rate contract, you shield yourself from unpredictable fluctuations in natural gas prices. This stability allows you to budget more effectively, as you’ll know exactly how much you’ll be paying for your natural gas each month (rather than being subject to the whims of the market). Plus, when you lock in your rate, you can take advantage of lower prices, ensuring that you are paying the most affordable rate available.
Natural gas contracts are typically between 6 months and 2 years, but can go up to 5 years, so knowing when prices are cheapest will help you get the best possible deal.Here’s a great article for how to lock in natural gas rates and when the best time is to do so!
3. Save Money on Groceries
Spending $250 a month on groceries is very do-able if you are conscious of how you store your food, what you buy and where you shop.
Below are some easy ways to cut your grocery bill in half!
- Plan meals around what is in your pantry and fridge
- Grocery shop with a list
- Shop seasonally
- Buy generic over name brand
- Change where you shop
- Opt for frozen food
- Cook a vegetarian meal
- Don’t shop hungry!
- Buy in bulk
- Utilize coupons, weekly deals and grocery store apps
Looking for even more ways to save money on groceries? I wrote an entire post on 21 ways to save money on groceries!
4. Choose an Affordable Cell Phone Plan
I was pretty conservative when I budgeted $60 a month for a cell phone plan. You can actually find cell phone plans for as low as $30-$40 a month!
Mint Mobile is by far the cheapest option out there. 4GB of data is only $15/month and an unlimited plan is only $30/month.
If you are looking at other options, this is a great resource for finding the best, cheap cell phone plans!
5. Save on Electricity
You should already be doing everything you can to save electricity (not just for your wallet, but for the planet too!)
Below are some effortless ways to lower your electricity bill:
- Unplug any device you’re not actively using
- Ditch your desktop computer for a laptop
- Line dry your clothing
- Replace the lightbulbs in your home! According to theUS Department of Energy, LED lightbulbs use 75% less energy than incandescent bulbs. If you still have incandescent bulbs in your home, make the switch!
- Keep those LED lightbulbs turned off unless it’s dark outside. Open your window blinds to let the natural light in instead.
- Use a portable electric heater during the winter time instead of heating your entire home with central heating.
- Dress for the weather! Instead of blasting your AC and putting a sweater on, wear shorts and a t-shirt around the house if it’s warm out. Same rules apply if it’s cold outside. Just bundle up and drink warm beverages rather than raising the heat in your home.
- Fix any air leaks in your home
- If you rent, look for a place that has electricity included! The cost of utilities can vary month to month which can make budgeting challenging. If electricity is included, you’ll never have any surprise bills at the end of the month.
6. Choose Affordable Health Care
The cost of health care varies significantly depending on your income level, where you live and your health care needs.
Assuming you make $2000 a month or less, your income should be low enough to qualify you for Medicaid. If Medicaid doesn’t seem right for you, there are plenty of other options out there for affordable health care.
Stride Health, Inc. is a California startup that focuses on connecting individuals with health plans under the Affordable Care Act. Stride has found people health insurance plans that cost less than $1/month and they can do the same for you!
7. Spend Less on Rent
Rent is most likely your biggest expense and unfortunately, there’s no way around that.
Luckily, there are ways to save a little bit of money on rent each month. Here’s how.
- Get a roommate (or two)!
- Find a cheaper place to rent! It may not be in your ideal location but if it saves you few hundred dollars a month, it’s worth it.
- Look for places to rent through Furnished Finder, Craigslist or Facebook Marketplace. Renting from a private party instead of a property management company can be way cheaper (and is usually an all around better experience).
- Sign an extended lease! Typically, if you commit to a longer term lease, your monthly rate will go down.
- Always negotiate your rent, especially if you are releasing. You’ll be surprised by how many landlords would be willing to drop the price of rent for a good tenant.
- If you are renting in an apartment complex, chances are, a free parking spot is included in your rent! If you don’t drive, ask your landlord for a discount on your rent in exchange for the unused parking spot.
8. Find Free Things to Do Around Town
Whether you live in a big city or a small town, there are plenty of free things to do if you just look for them.
Finding something free to do is as simple as typing ‘free things to do’ into your search bar. You will find free outdoor workout classes, concerts, movie screenings and so much more!
This will keep you well under your $209 monthly entertainment budget.
9. Start a New Hobby
Although starting a new hobby might cost you a little bit up front, it will pay itself back in no time.
After you’ve bought all your gear, the hobby is free to do! Instead of going out and spending money on your days off, your hobby will be a free activity you can always lean back on.
10. Spend More Time At Home
There’s nothing better than spending a relaxing day at home. And let’s be honest, on $2000 a month you can’t be going out all the time anyway.
Find ways to make your days inside more enjoyable! Read a book, listen to music, cook a meal, watch a movie, practice your hobbies or dance around the living room. The more fun you have at home, the less inclined you’ll feel to go out and spend money!
In Conclusion
If you need to start living off of $2000 a month, don’t sweat it! It’s possible to survive (and even thrive) on this budget. You’ll just need to be a bit more frugal if you want to live within your means.
I hope that these 10 frugal tips help you cut back on your spending!
Living within a $2,000-a-month budget requires careful planning and resourcefulness. The article touches upon various concepts, ranging from budgeting techniques to specific cost-cutting strategies. Here's a breakdown of the key concepts addressed:
-
Budgeting Basics: Creating and adhering to a budget is fundamental. It's about monitoring expenses closely to avoid surprises and ensuring all necessary costs are covered.
-
Expense Breakdown: The article allocates specific amounts to various expenses:
- Rent
- Groceries
- Cellphone
- Utilities (Electricity/Water/Gas)
- Health Care
- Public Transportation
- Entertainment
-
Savings: A significant point is that even with a $2,000 budget, it's possible to save $250 monthly by adhering to the provided expense breakdown.
-
Budgeting Methods: The article hints at the "50/30/20" budgeting rule as a strategy for managing finances, but doesn't delve deeper. This method allocates 50% of income to necessities, 30% to discretionary expenses, and 20% to savings.
-
Tips for Living Within Budget:
- Transportation: Advocates for using public transportation, ride-sharing apps, and grocery delivery services to eliminate car-related expenses.
- Natural Gas: Advises on securing fixed-rate contracts for natural gas to manage costs effectively.
- Grocery Savings: Tips on budget-friendly grocery shopping habits, like planning meals, buying seasonal items, opting for generics, and utilizing delivery services.
- Cell Phone Plans: Recommends exploring affordable cell phone plans, mentioning specific providers.
- Electricity Savings: Suggests simple ways to reduce electricity consumption and expenses.
- Health Care: Highlights options for affordable health care, including programs like Medicaid and platforms like Stride Health.
- Rent Reduction: Provides strategies for lowering rent costs, like getting roommates or negotiating leases.
- Free Activities: Encourages finding free local activities as a means of entertainment within a tight budget.
- Hobbies & Home Time: Emphasizes the cost-effectiveness of hobbies and the value of spending more time at home.
Living on a $2,000 monthly budget requires discipline, smart spending, and prioritizing needs over wants. Following these tips and strategies can help individuals manage their expenses effectively, save money, and live comfortably within their means.
