Saving when you earn less than 2000 euros per month in France may seem difficult, even impossible in this time of crisis. Yet, with clever planning and financial management, it is possible to put money aside for rainy days, future projects or retirement.
For this, it is necessary to work on three aspects: savings, expenses and income. We give you some tips for using these levers to build up savings, even with modest incomes.
Of course, there are special cases and everyone’s personal situation is very different: you don’t live the same way with less than 2000 euros alone or with a family to feed, in town or in the countryside, etc. All these criteria must of course be taken into account.
We are fully aware that the reality is quite different from all the theories. The idea here is therefore to give ways to optimize your finances even with modest incomes to be able to save even a little bit.
1. How to optimize savings?
Establish a budget
The first step to effective saving is to establish a realistic budget that takes into account your income and expenses. List your fixed (rent, insurance, subscriptions, etc.) and variable (food, transport, leisure, etc.) monthly expenses. Once you have an overview of your finances, figure out how much you can save each month.
Save automatically and regularly
Setting up an automatic transfer from your current account to a savings account is a simple and effective strategy for saving. Choose a fixed amount to transfer each month, right after receiving your salary. So you avoid spending that money without even realizing it.
Above all, don’t think too big. Better start small and scale up if you find you can save more. The idea is not to put yourself in the red to end up paying premiums that will ultimately cost you more than what you save.
Choose the right savings options
In France, there is no shortage of savings solutions. Between the Livret A, the Livret de Développement Durable et Solidaire (LDDS), the Livret d’Epargne Populaire or the Plan Épargne Logement (PEL), there is something for everyone and every project. So find out about the advantages and disadvantages of each savings product and choose the one that best suits your needs and financial goals.
Remember to determine what you will use the savings for. If it is a security mattress, avoid passbooks where the money is blocked. If it’s for an investment, think about blocked but more profitable booklets like the PEL. Note that if your income does not exceed a certain ceiling, the Livret d’Epargne Populaire is an excellent savings choice. If it is only capped at 7,700 euros, it has an excellent yield (6% at the time of writing these lines).
2. How to reduce expenses?
Now that you know how to save well, it’s time to tackle the hard part: optimize the balance between expenses and income to put some money aside. So let’s start with lowering expenses.
Avoid unnecessary expenses
It may seem obvious, but in our consumer societies, the temptation is great. You must therefore arm yourself with courage and rigor to reduce your expenses. First, eliminate compulsive purchases and superfluous expenses. For this, a tip: ask yourself if you really need this object or this service that you think you are offering.
Also ask yourself if you prefer to buy this product or devote this sum to savings for your holidays, for example. So think twice before buying non-essential items and look for less expensive alternatives for the products and services you use regularly.
For example, you can start by reducing your subscriptions to streaming platforms. There are packs to group all the services or online platforms for sharing accounts. There are no small savings.
Take advantage of discounts and promotions
If you have the time and the patience, taking advantage of promotions and discounts can save you a lot of money. Use price comparison and coupon apps to find the best deals. Sign up for newsletters from your favorite stores to be notified of sales and special offers.
You can also activate notifications on your favorite sites and scan for good deals. Also think about periods such as sales or Black Friday to take advantage of the best promotions.
Make group purchases
Buying in bulk or grouping your purchases with other people can also save you a lot of money. For example, group purchases for food and household products can reduce costs, while limiting waste. In France, these solutions are less widespread than in the United States, for example, but they do exist.
It is even possible to eat better for less by turning to local breeders who increasingly devote part of their activity to direct sales. For example, you can buy a whole animal with several households directly from the breeder.
Adapt your means of transport
With the rise in fuel prices, transport represents an increasingly important budget. If you live in town, ask yourself if you really need a car. The bicycle, the scooter, the skateboard, are good alternatives for getting around in urban areas and allow you to make a lot of savings (in energy, maintenance, repairs, etc.). You can also reduce your transport costs by using public transport.
If you live far from a city, consider carpooling. The government has put in place support measures to encourage this practice. Today, most workers use a one-person car. Not only is this expensive but also harmful to the environment. By opting for carpooling you will therefore save money and take care of the planet.
Prepare your meals at home
Yes, Uber Eats is easy. But it’s expensive. Preparing your meals at home allows you to control the costs of your food budget while eating better.
If you don’t have much time during the week, consider batch cooking, an increasingly widespread practice of preparing several meals for the week on Sunday. Yes, it takes time, yes you have to start cooking. But the savings are huge. A meal at home can cost 2€/person compared to more than 10 euros when eating out.
Save on leisure
The idea is not to do without leisure but to try to have fun without spending a fortune on each outing. Look for free or inexpensive activities in your area, such as exhibitions, workshops, concerts or outdoor events.
Consider discount offers on cinema, theater or museum admissions by signing up for loyalty programs or looking for special offers. Finally, if your accommodation allows it, invite your friends more often to your home rather than meeting them outside where the price of a drink is 10 times more expensive than if you consume it at home.
3. How to increase your income?
Find out about aid
Don’t forget to check if you are eligible for support and allowances, such as housing benefit, study grants or childcare support. These allowances can help you reduce your expenses and increase your ability to save.
In France, it was estimated that more than 30% would not take advantage of aid in 2021. A figure that tends to increase every year. Among them, the activity supplement, an additional income granted to people who work but do not earn enough to live with dignity.
Invest in training
Investing in your education and skills can increase your long-term earning potential. Explore job training or retraining opportunities, and look for grants or assistance programs to fund your education.
If your income is insufficient to save, developing skills can allow you to access better paying positions, obtain a promotion or even start your own business and improve your income.
Create a micro-enterprise
In France, the legal working time is 35 hours. If your employer respects this working time but you feel able to work more, consider creating a micro-business (formerly called self-employed) to generate additional income.
You can choose an activity that revolves around your passion or a skill that you have developed over time. If you feel able to work 1 hour more each day, you will reach an hourly volume of 40 hours per week or 20 hours per month (not counting weekends). In 20 hours, you can generate additional income allowing you to “put butter in the spinach”.
