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From a $100K-Plus Income to Less Than $35K and Happier Than Ever

Before I was let go two years ago, my husband and I enjoyed a combined income of over $100,000 plus very good benefits. We lived well then and surprisingly, are still managing fairly well. Today, both of us are self-employed with an income of less than $35K. Two years ago, we recognized that my job was not secure and made plans to shore ourselves economically. Fortunately, we had no mortgage or car loans. Before my layoff, we consolidated our credit card debt and opted for a small home equity loan.

Self-Employment and Debt

Because we own several businesses, we like to each have a vehicle, plus a back-up so we don't get stuck and miss opportunities to make money. A few weeks ago, our second work van died and all we had left was a truck. With our consolidated debt, we had a $300 mortgage per month. We had been postponing buying new vehicles for as long as possible to keep our debt minimized.

Emergency Fund and Leveraging Cash in Negotiations

Fortunately, we had saved for a rainy day and tapped into our emergency fund. My husband called me around 3:00 p.m., and asked me what I thought about him buying two vehicles for the price of one. Our budget was $10,000, and he had found both a mini-van and a pick-up truck that we could negotiate to our budget.

Minimize Costs

An hour later, we chose to finance one of the vehicles to keep some cash for a future rainy day. After giving him my credit information, the sales representative ran us through a credit reporting agency. Upon seeing the results, he jumped up and slapped my husband a high-five. Our credit was stellar.

Fortunately, bill-paying diligence gave us a lower interest rate. We spent five thousand in cash, reserved five and obtained two new cars for a $100.00 a month payment. Our insurance company modified our auto plan to remove the old vehicles and add the new.

There was no financial adjustment; our rate did not change.

Financially, it would be cheaper to pay cash for both vehicles; however, we would have lost our cash-flow advantage in case of another emergency. There is no prepayment penalty, and we plan to pay the loan off early, but even if we cannot, our long-term debt expenses are still under $500 a month or $6,000 a year. Our super saver mentality includes managing for risks, leveraging cash flow and negotiating better prices with bundling.

Always Ask

If we had accepted the original prices, there's no doubt we'd only have one car now. By simply asking for a better rate, we got it. Many people in our community are small business owners, and we have found that not only does it never hurt to ask, it nearly always yields a positive result.


We're big fans of the barter system. Living in a small community, many of our neighbors are in situations similar to ours. We help each other out by trading—when we needed wood for the winter, my husband painted a room for a neighbor who had some.

Buy in Bulk

Especially with non-perishable items, we save a lot of money by buying in bulk. From painting supplies to household items, it means additional organization in the garage, but it's worth it!

Re-Frame Your View

Losing my job was not the heartbreak I thought it would be. Not working in an office environment has lowered my income but also lowered my outlay. I no longer have enormous bills from dry cleaning. I no longer go out to eat because I don't have time to cook. I now employ not one, but two crockpots and have cut our grocery spending by cooking that way.

Being a freelance writer and speaker now, I spend more time at home with my family. We may have lost a lot of income, but we have gained a lot of family togetherness. And that, to us, is priceless.

This article is part of a series related to being Financially Fit


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