5 Steps To Live Within Your Means

It’s not working anymore.

Your financial situation is overwhelming and confusing and you don’t know what to do to change it. It’s a feeling I’ve personally known all too well.


When it comes to personal finances, there are a few things that are true for everyone and that works for everyone. No matter their situation to start with. Let’s call them universal truths to personal finances, to make it sound extra fancy.

I’ll let you in on one of these universal truths now. Let’s say you want to get a better financial situation or increase your power to save or invest. This holds true in either case, universal truth, remember.

In either situation, you need to increase the wiggle room between your income and your expenses. Simple as that.

Many universal truths are simple. Like, things that go up will always come down.

The focus of this guide is to help you if you’re in a bad spot financially.

If you’re looking for information on how to increase your wiggle room to save more, there’s also take-aways for you in this guide.

However, since the focus is on those of you that struggle, it’s written with you in mind. That’s why I talk about how to live within your means.

Things To Help You Live Within Your Means

To live within your means is the foundation for healthy personal or family finances. I’ll take you through how to do this in five steps. 

If you have any questions or want to add something, either comment below or click “Contact Me” in the menu above to ask me something in person.

1. Gratitude

The practice of being grateful is a topic that could quite possibly fill an entire book. I will not dive that deep though.

In regards to the subject at hand, to live within your means, I will explain what I mean by showing gratitude.

If you feel that money’s scarce and you feel poor, it’s very easy to long for another life. To long for other things. That’s normal because we’re bombarded with reasons to compare our situation to other people all the time.

I found this article where the author writes about what it is to live within your means. The five steps that is mentioned are really good and can be done by anyone to make sure you live within your means and do not overspend or get into debt.

I urge you to resist the want to compare yourself with others.

In the comparison, we focus on what we’re missing, not what we have. This is where gratitude comes into play. Look around you.

Do you have a place to live, drinkable water, food, indoor plumbing, and perhaps some clothes to put on your body? That’s more than some people have. I know you at least have a device to read this post on, be grateful for that if nothing else.

There’s actual poverty though. There are people who really are poor, who live their lives without access to the most basic of needs. I know this. I’m hoping that’s not you though.

I say some of our society’s poverty is constructed for us to feel deprived. We’re creating the idea of poverty in our minds. We feel that we need to have certain things, or be certain things, to not be poor.

Shift your mindset and begin to feel grateful for what you have. That will make it easier for you to live within your means since you will, little by little, stop wanting things you don’t need.

There are many different ways to practice gratitude and it can be as easy as simply saying thank you for things you have in your life already. It might feel silly at first, but trust me, later it will feel good and it will change the way you look at your life.

I’ve previously written the statement that the Joneses are the enemy of frugality. That’s also true when it comes to living within your means. Keeping up with the Joneses makes it way harder to live within your means.

2. Track Your Money

Let’s start with an analogy. You’re out on the sea in a boat and you begin to take in water. Desperate not to sink, you want to plug the hole where the water’s coming in. But first, you need to find it.

Tracking money is like that.

You need to sit down and first track your income on a normal month. Then track the expenses of any normal month. A month that’s not normal is December, for instance. All those presents can kind of kill even the tidiest of budgets.

Oh yes, the tracking of money is the groundwork for a budget.

Anyway, to get a normal month I usually suggest that you take three normal months expenses. You get all the different kinds of expenses and categorize them. Add them up, divide them by three.

Now you have a normal month, on average. You can use this method for your income too if it’s not the same from month to month.

Since I consider this a foundational thing in personal finances, I have a rather big guide on this which you can read here.

3. Budget

The budget is to personal finances what the hammer is to the carpenter. It’s one of the most used tools in the toolbox. Perhaps the most used tool for carpenters today is some sort of power tool though, but you get the point.

To be able to live within your means, you need to define how to do that. That’s what the budget will do for you.

If you’re unfamiliar with the basic ideas of budgeting, I’ll explain it quickly here. You’ll categorize your money in different incomes (if you have several) and expenses. Your goal is to stay under an amount of money you assign to each of the expense categories.

That was very basic and if you want more help on making a budget, I have an entire eCourse on how to do that. But first, you might want to read about what budgeting system you want to use in this post.

4. Consider Needs Versus Wants

As I mentioned earlier, we get exposed to so many messages that relate to how we should be, or what we should own every day.

Look at most commercials you see, or adds, or influencers on social media for that matter. They all show a way of living. Ads today very rarely sell a product as such, they sell you the lifestyle associated with the product.

If you’re like most people, myself included, you fall for that shit. We all do. We might want to drink Martini because George Clooney does.

But do we need to?

We don’t need to buy the lifestyle at all if we’re happy with who we are. Let me guess that there’s some part of your life you’re not completely content with though. I want to give you a nudge to try to practice gratitude in that part of your life for a while too. See what happens.

See what I did there. Fancy connection to a previous part, right?

Depending on where you are in your life your needs will be different. Your needs will not be the same as mine. So I can’t tell you what you need. But I can tell you that it’s very unlikely that you need all the stuff that media says you do.

You might want those things. And that’s the thing. If you want to learn to live within your means then you need to take a long hard look at what’s an actual need and what you want.

I, for instance, have a three years old smartphone. As you know, in smartphone terms that’s ancient. At times I catch myself saying that I need a new phone. Bleeep! Bleeep!

Nope, I don’t need a phone. It’s not part of what I work with so I don’t need it to make money and put food on the table. I want it to connect with people around me.

But here’s a shocker, people were great at staying connected with each other before the smartphones ever appeared on the market.

So, I don’t need a phone. I want one.

5. Boost Your Income

Let’s say you budget to your heart's content, but you still can’t make the income cover expenses. Then it’s time to consider bringing in more dineros. 

There are a ton of different ways to bring in more money. I’ll list some below.

Since it’s most likely a problem with having too little money coming in each month, I’ll only list things that can increase your monthly income, not one time things.

- Get a Raise

As if you haven’t tried, right?

You know you’re the company’s most valuable employee. The problem is that the boss doesn’t know it yet.

I’m no expert at salary negotiations, in fact, my best result in salary raise came when I asked to not get one. Corny as it sounds my coworker was making much less than me for the same job, only because she started working a few months later than me.

So I asked the boss to give her my raise to even out our salaries. We both ended up getting a pretty good raise that time.

Anyway, if you search Google for what you should do to get a raise, a few things surface over and over. The most popular ones you find with a search are listed below.

Tell the boss your intentions and goals

Let the woman, or man, know what you want to do in your current position. Let them know you’re going places. At the same time, ask them what they need from you to get a raise right now. This leads in nicely to the next thing...

Do More Stuff

Ever find yourself not doing anything at work. Idle hands cost the company money. Suggest that you can do more things if you can get more money. Don’t outright say that you’re just sitting on your hands at times - that might get you a boot in the butt, instead of money in the bank.

Research First

Let’s say you're short $200 per month to live within your means. Do you straight up ask your boss to cover that by asking for a raise of that magnitude?

Nah. Check around, research. Find out what normal pay is for the job you currently do. Make sure you’re getting what you’re worth. Find out what your coworkers in the same position are getting. If you’re way cooler and work harder than them, perhaps that’s your selling point with the people upstairs.

If you suggest doing more stuff, know what is that worth in terms of money.

If All Else Fails

Let’s say shit doesn’t go your way. You can’t get a raise even if you offer to do the boss’ laundry. See if you can take on more hours if you have the energy and time. Show initiative and then, in a while, try to get a raise again.

Make them see you as the good person and employee you are. And if it helps to do the boss’ laundry, that’s just gravy.

That’s a joke. Mostly.

- Drive for Uber

This does require you to have a car, which not everyone does. If you’re not familiar with it, Uber is like a taxi-kind-of-gig. People request a drive through their smartphone app.

If you have a car, like meeting people and driving them around, this could be a good way to make some extra money. At least on nights when you’re not working your ordinary job for starters.

There are people who even make full-time incomes by driving for Uber.

I’ve not tried this myself, but there are many articles and stories about people who do this successfully.

- Work on Fiverr

Do you know a skill that someone might need, like web design, graphics design, coding, translating, well, you can do most things through Fiverr (affiliate link - and one I haven't tried, but Fiverr is a huge place which I trust).

I suggest you check their website out to see what kind of things people do there.

It might not be the most lucrative side gig, but it can bring in a few more bucks to help you get within your means.

The Main Take-Away?

Now that you’ve read the post, what was the thing you think will have the biggest impact if you start doing it today?


About the Author

I've always had an interest in personal finances and money. Since money is so closely connected to our happiness I want to share what I've learned during the years. My mission is to make things a bit better in the financial area for people who read my post.

Manage Y​​​​​our Family's Money - FREE Checklist​​​​​

Take Control Of Your Money Today With This 16 Step Checklist!