When seeking out the cheapest way to live, being creative can go a long way. Although you might have to make some relatively unique choices, choosing to live in a more affordable way can set up your finances for long-term success.
Let’s explore options for the cheapest way to live. Plus, why you should even consider this idea in the first place?
Reasons to find the cheapest way to live
Typically, the word cheap has a negative connotation to it. But the reality is that living cheaply can be a positive thing for your finances and your life. (Note that living cheaply is very different from being cheap!)
Here are some of the reasons you may want to learn how to live cheaply.
To achieve your financial goals
The most obvious reason to live in a simple way and cheaply is the ability to make faster progress toward your financial goals. After all, you’ll have more money to commit to your money goals if you aren’t spending as much to make ends meet.
For example, let’s say that you have the financial goal of paying off your debts. If it takes less money to pay your bills each month, you can push more money toward that major goal.
To achieve your life goals
Whether we will admit it or not, many of our life goals are directly tied to our financial situation.
Personally, I want to take an extended trip to Spain. But in order to make that happen, my financial situation needs to be solid. Plus, I’ll need to pay for the trip itself.
It’s likely that you have a life goal that is tied to your finances. A few common examples include exotic vacations, vehicle purchases, home purchases, and leaving paid work behind for early retirement.
Consider the big life goals you have for yourself. If there’s a monetary cost tied to that goal, choosing to live on the cheap can help you attain that goal faster.
In order to build a solid financial foundation
A recent survey conducted by Mint found that 66% of Americans have financial stress several times throughout the year.
Although the reasons for financial stress vary, a solid financial foundation is one way to permanently lower that stress level.
If you are struggling with regular financial stress, getting your finances into a better place might be the antidote you’ve been searching for.
Learning how to live simply and cheaply can open up your budget to leave more space for building a solid financial situation.
Importantly, the choice to live cheaply doesn’t have to be a permanent one. You might decide to opt for the cheapest way to live for a short period of time to give your financial situation the breathing room you crave. After that breathing room is created, you might allow your spending to grow.
A desire for a simpler life
Some of the cheapest ways to live are also some of the simplest ways to live. In our fast-paced society, the pressure to keep up with others is a real one. But a wave of people embracing a more minimalist lifestyle is changing things up.
If you are unhappy with your current situation, exploring the concept of simpler living could help you find the purpose you are looking for.
Cheapest ways to live: 7 Key tips
If you’ve found your reason to opt for a cheaper way to live, now it’s time to explore your options.
The good news is that cutting back on your housing expenses can significantly change your financial trajectory. And even more good news, there are several ways you can make this thought a reality.
Here’s a look at how to live cheaply:
1. Consider moving to a new location
If you live in an expensive corner of the world, you’ll be forced to pay a lot more for the basic necessity of shelter.
Take some time to explore the cost of living in your current location. If moving is an option, you could cut costs by making a change of locale.
Although a move is a major undertaking, it could be a great chance to explore a new corner of the world or return to your roots.
2. Downsize your house
If moving cities isn’t an option, then moving to a new place within your current city might be. Typically, you can save significantly by downsizing your living space.
For example, going from a four-bedroom home to a two-bedroom townhouse should save you money.
If downsizing your living space is feasible for your family, then explore how this move could impact your budget.
3. Think outside the box for housing solutions
Creative housing solutions might push against your conventional housing mindset. But if you are open to changing things up in a big way, then thinking outside the box can transform your financial situation.
One creative option is to try house hacking. Essentially, this involves purchasing a multi-family building as an owner-occupant.
Once you have the building, you rent out the other units to cover the cost of your mortgage. For example, you could buy a duplex to rent out one half.
The concept of housing hacking comes with limitless variations. If you don't mind a challenge and want to own your own home while someone else pays the mortgage, this is a useful option.
Other creative housing solutions include choosing to live in an RV, van, or tiny home. If you are willing to live in a much smaller space, this solution could be the right one for your budget.
4. Find a roommate
For those that have extra space in their current living situation, finding a roommate is an effective way to reduce your housing costs. After the roommate moves in, you’ll immediately lower your housing costs.
If you aren’t interested in a long-term roommate, consider renting out the extra room on a short-term basis to travelers through a service like Airbnb.
5. Ask to move home
Moving back to your parent's house is a decision that comes with plenty of emotions. Even if you are lucky enough to have this option, you might not be interested in living under their roof again.
If you have a clear financial goal, like paying off debt or saving for a down payment, this option might be more palatable because you have an end date in mind. And when wondering how to live simply and cheaply, it could be a good option.
6. Get work-covered housing
In some lines of work, you can have your employer cover your housing costs.
A few different jobs that might offer this type of perk include nanny, caregiver, on-site property manager, and seasonal jobs in remote areas.
Although this path will likely require a fair amount of searching, it might pay off. But be prepared to have the employer compensate for this perk in the form of a lower wage.
7. House-sit around the world
House sitting is a flexible opportunity that can take you all over the world. As a house sitter, you’ll stay in someone’s home to take care of it while they are away. In many cases, you’ll also be in charge of taking care of the homeowner’s pets.
Adventurous souls might be drawn to this opportunity because it gives you a chance to travel for cheap.
Although house sitting around the world might not be the simplest way to make a living, it does offer the chance of making your travel goals more affordable.
How to make cheap living work for you
Although you may know the mechanics of how to live cheap, opting for the cheapest way to live isn’t always easy. In fact, it’s usually a challenging process of making big changes.
Of course, these major changes can have a positive impact on your life for years to come. But making the switch comes with ups and downs.
Here are some strategies to consider when attempting to make the cheapest way to live work for you.
Flexibility can be a sort of superpower when trying to live cheaper. It’s likely that your new lifestyle includes less space than you are used to. With a flexible mindset, you can more easily adapt to changing circumstances.
Don’t be afraid to challenge the norms of your peers when looking for a more affordable way to live.
Be kind to yourself
Change is often challenging. After all, most of us get comfortable in our routines and in our space. Learning how to live cheap will likely force you to make a big change to your living situation.
It’s natural to have negative feelings at some point in the process. Instead of focusing on the negatives, encourage yourself to think about the benefits.
Reminding yourself about the long-term benefits will help you maintain a positive mindset along the way, which is a key part of being kind to yourself.
Make adjustments as necessary
If you immediately envision yourself very comfortable with one of the cheapest ways to live, that’s a great place to start. But if possible, think about the switch to living cheaper as a journey instead of a single change.
You might find that your original plan isn’t working out. Instead of giving up, try to pivot along the way.
For example, you might decide that house sitting around the world doesn’t suit your lifestyle and decide to pivot into a house hacking situation.
For those with a flexible attitude, you can more easily make adjustments as necessary.
Finding the cheapest way to live can improve your finances!
Committed to living on the cheap? It is entirely possible to slash your housing costs.
Although the process might be a tad bit uncomfortable, you can potentially transform your financial future when finding the cheapest way to live.