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Managing on a low income

Making every dollar count

Page reading time: 4 minutes

Get the most out of your money and feel more financially secure.

If you're in crisis or struggling to make ends meet, see urgent help with money.

Where to start: money in versus money out

A good way to start managing your money is to look at what's coming in versus what's going out.

Look at your income

Work out how much money you have coming in. This could be money from your wages, a pension, government benefit or payment, or income from investments.

If you're unsure, look at your payslip or bank account each week or each fortnight.

Track your spending

To see how much money is going out, track what you spend over one or two weeks. Include every transaction, no matter how small. See track your spending for easy ways to do this.

This will give you a clear view of where your money is going.

Separate needs from wants

Use the information you've gathered about your 'money out' to decide which things are your 'needs'. These are the essential items you need to live, such as your accommodation or electricity.

Everything that is not a need is a 'want'. These are things you could live without. You could choose to save the money you spend on these things, or you could redirect it to where you need it more.

If you do cut back on wants, look for other things to make you happy that don’t involve spending money. See simple ways to save money for ideas.

Think about what you spend

Knowing exactly how much you pay for things means you can look for better deals. See where you can save — on everything from groceries and clothes to phone plans and electricity rates.

Think about what you want to do with your money. By setting a goal, such as paying off a debt or saving for emergencies, you're more likely to spend less.

Get financial support

The Australian Government, state and territory governments and community organisations offer financial support for people on low incomes or experiencing hardship.

Government payments, benefits and concessions

Use the Centrelink Payment and Service Finder to see the payments and services you may be eligible for.

You can also visit these websites to find out about government financial assistance:

Support from community organisations

Some community organisations offer lower cost financial products for people on a low income:

Financial counselling and help

If you need help managing your money, contact a financial counsellor. They can show you how to budget and manage your debts, and how to deal with other money problems.

For free general financial help, such as budgeting or preparing for retirement, you can contact the Financial Information Service (FIS).

Smooth your bills

Knowing when expenses are due can help you plan and stay in control of your money.

Use your bills and bank statements to mark the due dates and amounts on a calendar. Add them up to work out how much you'll need to put aside each payday to cover bills when they are due.

Pay bills in instalments

Contact your utility and other providers to ask about 'bill smoothing'. This means paying smaller amounts more often (for example, fortnightly or monthly), instead of paying in one go.

If you have overdue utility bills, you can contact your service provider to find out your options.

Use Centrepay

If you get a Centrelink payment from Services Australia, you can use their free Centrepay service.

You can ask them to take a small amount of money from your payment to pay regular bills, such as rent. This can make managing your bills easier.

Start a savings habit

Once you have your money under control, try to start saving. Having some money set aside can be useful when unexpected or urgent things come up.

Try the Saver Plus program

Saver Plus helps people on low incomes to save and to improve their financial skills.

You set a savings goal, and when you reach it, the amount is matched (up to $500).

Open a high-interest savings account and set up an automatic transfer from your everyday account on the day you get paid.

Woman and her daughter playing with toy abacus.

Nikita looks at her spending

Nikita is a single mum on a low income. She was finding that she was always running out of money before her next payday. This made it hard if she got an unexpected bill, and it made her quite anxious about money.

She decided to look for ways to improve her situation. She started by being more aware of her spending.

'I was amazed at how much we were spending on small, unnecessary items that quickly added up. By planning meals ahead and cooking at home, I managed to build some savings. It was hard, but it's a relief to know I can manage if my car needs repairs or if one of my kids needs something for school.'