If your budget’s been a bit more strained than usual in the last few months, you’re not alone. High inflation, lagging wage growth and the potential of a looming recession are some of the reasons why saving money might be getting more difficult.

Still, being on a tight budget doesn’t mean there aren’t ways to set aside money to build a savings account. Here are 12 tips to help you build a healthy nest egg.

1. Focus on small changes in various budget categories

Being on a tight budget means every spending decision adds up, but you can start saving money by making small changes. For example, the money saved by making lunch instead of buying carryout or eating out can easily add up. The same is true with brewing your own coffee rather than stopping for a cup at Starbucks.

Some other changes include:

  • Turning lights off when you’re not using them.
  • Cutting the cord on cable and opting for cheaper streaming services. Streaming services often have shared or family plans that you can split between multiple people to lower the cost even more.
  • Withholding from impulse purchases. One way to help do this is by writing down wants and waiting a week before buying them, so you can see if you still want them.

One way to budget is to use the 50/30/20 rule, which means allocating 50 percent of your income to essential expenses, with the remaining half — known as discretionary income — going to things you want (30 percent) and savings (20 percent).

2. Use a budgeting app

A budgeting app can help you manage your budget and maximize your savings. For example, Digit automatically examines your accounts and moves money for you to help boost your savings. Also consider Chime, a banking app that makes it easy to save your spare change.

Budgeting apps generally work by tracking your spending and may even predict future spending, saving you time on estimating budget line items. Then, you can keep tabs on how much you’re spending in each category monthly and look for where you can cut down.

3. Take advantage of student loan forgiveness

In August, President Biden announced a new federal loan forgiveness plan, which is expected to benefit millions of federal borrowers.

Individual borrowers that make $125,000 or less annually (or $250,000 for married borrowers) are eligible for up to $10,000 in federal student loan forgiveness. Those that received a Pell Grant are eligible for up to $20,000 in forgiveness.

Once the applications for student loan forgiveness open, the Office of Federal Student Aid advises that borrowers apply by Nov. 15, 2022. However, the applications will remain open until Dec. 31, 2023.

Additionally, the Biden-Harris administration has extended the student loan payment pause a final time to Dec. 31, 2022. You can use the time during this pause to save what money would have otherwise gone toward student loan payments.

4. Shop around for insurance rates

It’s smart to compare prices on auto and homeowners insurance every few years. An accident-free discount or other loyalty discounts may help you save by staying with your current company. But other times you’ll save more by switching or merging both auto and homeowners insurance with the same company.

Also double-check to make sure you’re receiving any discounts you’re entitled to, such as discounts for insuring multiple cars or being a safe driver.

5. Refinance your mortgage

Refinancing is an opportunity for some people on a tight budget to save money. If you can reduce your mortgage interest rate by 0.5 percent or more, it might be worth considering doing so now. Refinancing a mortgage could save thousands of dollars over the life of the loan.

For example, a homeowner with 25 years left on a 30-year, $275,000 mortgage has:

  • Current balance: $250,230.95
  • Original interest rate: 6.5 percent
  • Current monthly payment: $2,089 in principal and interest each month.

Over the course of the loan, the homeowner will pay a total of $344,370 in interest.

Now, let’s say that this homeowner could refinance to a 25-year mortgage with a 5.25 percent rate.

  • Refinancing would lower the principal and interest payment to $1,499.50 a month, saving $589.50 each month.
  • The total interest paid, assuming the mortgage is kept for another 25 years and including interest paid on the original loan for five years, equals $199,620.03 — a savings of $144,749.97.

Closing costs, which average about 3 percent of the refinanced amount, are an important consideration when refinancing a mortgage and weren’t included in these calculations. These calculations are for illustrative purposes only and are meant to provide general guidelines for refinancing your mortgage. See how much you could save with Bankrate’s mortgage refinance calculator.

Even without considering the savings of paying less interest over time, saving money on monthly mortgage payments could help someone on a tight budget without affecting the home’s payoff timeline.

6. Find a way to save on rent

Renters may want to consider moving to a smaller place or a lower-cost area to save money. If you changed jobs during the pandemic or don’t have to commute every day, moving to a cheaper place could shave big bucks off your housing costs, which are often the largest expense in a household’s budget. You could also try negotiating your rent or the term of your lease to potentially save money on rent.

7. Get a bank bonus

Some banks offer a bonus for opening a new account and meeting a few basic requirements like setting up direct deposit or maintaining a minimum balance. Some of the best bank bonus offers let you earn about $250 or more within a span of just a few months.

Read the fine print before signing up for a bonus so you’ll know how to earn the bonus and how long you need to keep your account open. Also watch out for minimum balance requirements that might make it difficult to open or maintain your account, as well as account fees that could eat away at your bonus amount.

8. Automate your savings

It’s easy to forget to save. That’s why automating the process is the best way to save money.

Some mobile banking apps come with automatic savings features. But if not, you could always download a third-party savings app, such as Chime, which estimates how much you can save each month and moves that money into your savings account.

Have your employer deposit part of your paycheck into a high-yield savings account to separate it from money used to pay bills. Compare rates to ensure your savings are earning a competitive yield.

9. Take advantage of pre-tax savings options

Set up automatic contributions to your employer-sponsored retirement plan, such as a 401(k), which uses pre-tax dollars to fund your retirement and can lower your taxable income. What’s more, some employers offer to match employee 401(k) contributions, providing essentially free money to help build your retirement savings. Employer-match programs typically require workers to contribute a minimum amount to qualify.

10. Take stock of food spending

Food can be one of the most expensive categories of budgeting, but it’s easy to control spending by making your own meals and cutting down on dining out. Learn how you can save money on your groceries.

11. Find cheaper ways to travel

More people are traveling now than at the height of the COVID-19 pandemic. If you’re making travel plans — whether to visit a relative or to take a much-needed vacation — make sure to establish a budget for the trip ahead of time to avoid splurging.

When it comes to the flight, you may be able to save money by booking a red-eye flight or flying with a budget airline.

You can also save by staying at a budget-oriented hotel or Airbnb, picking up some groceries instead of eating out every meal and using a credit card that doesn’t charge foreign transaction fees.

12. Check your paycheck withholdings

Getting a tax refund each year may feel like found money, but the truth is you’re overpaying the amount you owe in state or federal taxes. That money could be put to better use during the year, by paying down high-interest debt, building an emergency fund or adding to a rainy day fund.

Check with your accountant or use the IRS withholding calculator to see whether changing your tax withholding makes sense for you.

What experts say about saving money on a tight budget

Here’s what financial experts say about stretching your money.

Greg McBride, CFA, Bankrate chief financial analyst: “Trying to save when there is little or nothing consistently left over is challenging, so flip that around and do the saving first. Set up a direct deposit from your paycheck into a dedicated savings account and contribute to your employer-sponsored retirement plan via payroll deduction. While saying ‘you won’t miss what you don’t see’ sounds cliché, it’s true. Anybody I’ve ever counseled to do this that followed through came back and sang the praises of how well it works.”

Malik S. Lee, certified financial planner, managing principal and founder of Felton & Peel Wealth Management: “I think there are two things you must do to save while on a tight budget. One, you need to stay on budget and eliminate impulse purchases. Two, you need to utilize pre-tax employee benefits. Saving to vehicles like 401(k)s and HSAs pretax via your paycheck allows you to hit your savings goals while keeping more in your pocket versus saving after-tax.”

Malcolm Ethridge, certified financial planner, executive vice president and fiduciary financial advisor with CIC Wealth Management: “People who rent an apartment or house, they may not know it’s possible to negotiate their next lease when the landlord makes an offer to renew. This is especially true for those who rent from an individual or a smaller property manager. It’s also a good idea to try and lock in a longer lease now if they plan to be there for a while. And the landlord will likely be even more flexible on rate if they know they have you locked in for 24 or 36 months instead of 12.”

— Bankrate’s René Bennett contributed to an update of this story.