When you need armor or weapons repaired, do not pay smiths to do the repairs, as they charge a lot. Instead, simply buy as many Repair Kits as possible from merchants. Once you are approximately ten hours into the game, they should be pretty easy to find. Try finding backpacks to have more room to carry them. Using Repair Kits should save you a lot of gold, especially once you acquire rarer weapons and armor that are expensive to have repaired at a smith.