We've been living on the equivalent of about one income for the past five years now. And amazingly, while there are of course things we'd like to have a bit more money for, the act of living on a single income isn't really all that much of a hardship. As we watch many families around us struggle to make ends meet on two incomes, we manage to get by just fine on one. Here are some of the things that we do to make our situation not only manageable but relatively enjoyable as well.
Cutting costs can be a huge aspect in making a one-income situation work. Keeping the status-quo after that extra income is lost can lead to overspending and increased debt. Once we knew that our income was going to be cut in half, we focused on several main areas where we felt our family could recognize the most savings first. Places like transportation -- since I would be staying at home with our baby -- childcare of course, utility costs through reducing our cable package, and food and entertainment by minimizing the amount we went out to eat and the number of road trips we went on.
From there, we began to look for little ways to cut costs moving forward as we became more accustomed to our new situation. Trying new low-cost meal ideas, doing more shopping at resale shops for our clothing needs, and finding ways to further reduce our utility costs through reduced consumption due to better home climate control were some of the other ways in which we focused on further decreasing our spending.
Smart Spending through Budgeting
Living on one income also brought forward the true importance of living on a budget. Not only did we begin to realize that with margins slim on income versus expenses that a budget could help keep up on track with spending, but it also allowed us to get a better overall financial picture for our family through being better able to analyze costs and plan for the future. We don't just put down we we'd like to spend in our budget but what we actually spend once a particular cost has come and gone.
Using our budget not only as a planner for what we spend, but as a tracker of what we have spent lets us look not only at what we're spending our money on but in what amounts, where, and how these amounts change month-to-month and year-to-year. Having this full understanding helps us maximize our money when there is less of it to go around.
Reaping the Rewards of "at-home" living
Learning to enjoy being at home can be a great way to reap the rewards of being able to live well on one income. Obviously with me being at home we save on childcare costs and through cutting our two-vehicle family down to one. However, reaping the rewards of at-home living means more to us than just how much money we can save through circumstances that not all families may enjoy; it also means making the most of a situation that just about anyone with a family can take advantage of.
What do I mean by this? Well, it's pretty simple. Rather than heading out to a restaurant for dinner, I'd much prefer to hear from my family how much they loved the dinner I created myself. It's intrinsically rewarding as well as financially rewarding. Rather than going out to a fancy birthday meal, I'd rather eat a home, watch movies with the family and enjoy time with them. Rather than going out to the movies, I'd rather watch a movie we already own or that is on television, saving the cost of tickets, popcorn (which I can make at home), and all the rest, and making an event of a night spent at home in the privacy of our own space where we can talk, laugh, and enjoy one another rather than sit quietly in a darkened movie theater.
That is what I mean by reaping the rewards of at-home living. It entails making the most of the people with whom we live, and through that enjoyment cutting the costs of entertainment that can come with many outside-the-home type activities.
Realistic Living and Managing Our Expectations
When it comes to realistically managing our lifestyle expectations, we attempt to avoid keeping up with the Joneses. By not trying to keep pace with others, we find that we're more easily able to live how we want to live and not be swayed by styles, trends, fades, and other people.
No, we don't have tablets or trendy cell phones…nor do we have the hundreds of dollars of costs that come along with such products. No, we don't have a new car, choosing instead to drive our ten-year-old vehicle and save $20k on buying new. No, we don't have a huge Victorian mansion like many of our neighbors, choosing instead to live in a small condominium and in turn live mortgage free and pay a fraction of the property taxes those in larger single-family homes in our area do.
All these decisions -- while making us somewhat different from our neighbors -- also keep our costs significantly lower and make living on one income much easier.
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The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute legal or financial advice. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.
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