Design your magazine with your budget in mind. All of the magazine designing can be done on computers by using programs that are either free or very cheap to obtain. While creating the magazine, make sure to stick to black and white images and limit the amount of pages that will be included in the magazine.
Obtain free submissions from writers. While all magazines would eventually get to the point of wanting to pay their writers, certain magazines may offer the exposure as compensation for the content. Make it clear to the writers before soliciting submissions that there is no pay involved at the current moment.
Print on cheap paper. While it would be preferable to print on glossy paper, it is expensive to procure and print in mass quantities. Cheap paper can be purchased in bulk for very little money.
Print in bulk. If you are using an outside company to print your magazine, printing more copies will usually get you discounts for the overall cost. However, using outside companies will drive the cost of the magazine up.
Solicit advertisers. While it may be difficult to obtain those who want to advertise in your magazine when you are still in the process of creating it and obtaining an audience, there may be certain local business who will offer you money in order to run an advertisement for them in your magazine. This money can then be used to print more (and better looking) copies of future issues of the magazine.
Sign up for a company such as MagCloud.com which allow users to compile and put together a magazine that will be printed on demand when readers purchase a copy of the magazine.
Upload a PDF file of the completed magazine to the website's server. Readers will now be able to purchase the magazine for a variety of prices (depending on the type of paper, color and amount of pages in the magazine) and have it delivered to their home.
Receive the payment from the company once your magazine sells. However, since you are going through an outside company, they will take a percentage of the sale in order to pay for the printing and distribution of the magazine. That said, because the magazine is not printed until a sale has been made, you will have printed the magazine without spending any of your own money except in design.