A Financial Planning Guide for Low and Middle Income Earners

Once you start earning money, your priority should be to look for ways to save them. While it might be great to treat yourself once in a while, you should always try to keep more than what you spend.

While being financially healthy may sound easy for high-income earners, it can impose great challenges for low- and middle-income earners. If you fall under those two categories, you should take up the extra challenge and find a way to be financially wise.

Moreover, below are the financial planning guide you can follow if you think you’re a low- or middle-income earner:

Have A Financial Plan

Every time you receive your pay check, you should have a solid financial plan to follow. With the right strategy, you can ensure you’d have enough money for your daily needs, along with saving more for your future use. In this way, you can avoid asking for loans which may cause you to drown in debt.

When creating your financial plan, always ensure you make it as realistic as possible. You should have the exact numbers of your monthly salary, to identify how you’ll divide it according to your needs. This includes your fixed bills, such as electricity, water, gas, and rent.

As you build your financial plan, ensure you set yourself with a financial goal that you need to achieve at the end of that period. It could be earning enough money to pay for a new house, prepare for your children’s education, support business expansions, and more. With the right goal, you’ll be more motivated to save and look for ways to reach your goal quickly.

Spend Only On The Necessities

While it might be fun to treat yourself every time you get your salary, it would be best to save the money instead. In this way, you can keep more money, which can benefit you greatly in the future.

Ideally, you should plan every cent of your salary. You should first deduct your household bills and rent, including your grocery expenses. With what’s left of your funds, you should keep at least 80% as your savings, and 20% as your pocket money. In this way, you’ll still have a little money left with you, which you can use to treat yourself with little things.

Pay Your Debts

During your darkest times, sometimes you may need to ask for a loan to pay for something significant. It could be for your house rent, hospital bills, college education, and more. While you may need the money immediately, asking for a loan might be your last option.

With your existing loans, you should always try to look for ways to pay them as quickly as possible. The more you allow yourself to be in debt, the more you might just find yourself drowning in one, not able to recover from it for a long time.

If you’re not earning enough to pay for your debts, you should try to look for ways on how you can make extra income. It could be reselling or trying out freelance jobs. You could even cut back on your bills by trying to lower your household expenses. Just try to look for ways to control your debt and avoid having more.

Always Look For A Cheaper Alternative

Before you purchase something, you should contemplate if it’s something that you really need. If it’s a necessity but still quite expensive, you should consider looking for a cheaper alternative. There could be cheaper brands, or other sellers who sell the same items for a more affordable price. In this way, you can save more money while still getting the benefit that you need.

A woman holding shopping bags

You can begin shopping at discount stores for your basic necessities. You could even choose to invest in a bike to bring you to different places rather than spending money on transportation or using your car, which will need gas money.

If you’re looking to purchase something but you’re not in a hurry, you should consider looking for discounts and sales online. Moreover, ensure it’s something you need and not just something you’d like to have because they’re on sale.

Enhance Your Skills

Having a low or middle income doesn’t mean you’ll be on that path forever. With that said, you should always look for ways to improve your skills so you can allow yourself to earn more. After gaining enough experience and skills, try to look for a better opportunity for your career. In this way, you can make more while levelling up what you can do.

Apart from looking for a better-paying job, you should also consider building your own business where you can be your own boss. While you may start small, the more you try to work on it, the more successful you’ll be at it. Who knows? It might be your new road to success.


Being a part of the low- and middle-income earner can be very challenging, especially when you need to handle various responsibilities. However, with the right mindset and determination, you can allow yourself to be financially stable, and never have to worry about any unexpected expenses.

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