Living on one income can be a daunting thought for many families today. When my husband and I started our family we both agreed that I would stay at home with our children. I grew up with my mama at home and I wanted the same for our children but we knew that it would require some smart financial planning and a little sacrifice.
If you are considering becoming a one income family or perhaps you don’t have a choice in the matter then I have some great news, it is totally achievable! That being said, there are some things you need to plan for and some things you and your spouse need to agree upon to make it work.
My dad has always been a very financially savvy man and made a modest living. We lived off one income for the majority of my childhood and yet we always had enough. We even went on holidays for several weeks each summer. Yes, that was 20-30 years ago and a dollar certainly stretched further back then, but it is still completely possible to live off of one salary today. Much of what my dad did 30 years ago my husband and I still do today.
If you are ready to start the process of becoming a one income family or make things financially easier for your current situation then grab a cup of coffee and let me help you with these 8 tips!
1. Budget
If you are not living on a budget then this is the very first thing you need to do. Setting up a budget is easy but living according to your budget requires consistency.
One of the best budget templates that I have used is Dave Ramsey’s Every Dollar Budget. This is a free tool that you can use to set up your budget easily and track your expenses.
Grab a coffee and your spouse and set up your budget together.
2. Emergency Fund
Setting up an emergency fund is going to be paramount in helping you get through unexpected expenses that come up. There are always unexpected expenses that arise throughout the year so being prepared for these will keep you on budget and out of debt. Want to learn how to set up an emergency fund? Here is a great starting article on just that! A Quick Guide to Your Emergency Fund
3. Cut Costs
Cutting costs will naturally flow from starting a budget and consistently living by it. There are always areas where you can save if you look. Things like cell phone plans, eating out, hefty car payments and frivolous spending are all areas that can usually be reduced with a little effort. One such area that my husband and I plan to cut down on this year is our cell phone plans. Shop around for better deals and services.
Related: Money Saving Tips for 2020
4. Pay Off Debt
Don’t get into the habit of borrowing money or using credit cards to get the things you want. Debt will keep you enslaved to those hefty monthly payments and keep you from reaching your financial goals. If you are constantly spending your paycheck to pay off debt then you need to examine your priorities.
If you are currently in debt and need some extra tips for getting on top of those payments then check out this post How to Become Debt Free.
5. Be Content with Less
Changing the way you think about your wants vs. needs will help you live successfully within your financial framework. If you are spending more than you make on wants then your pattern of thinking needs to be examined. The trick is to be content with less. This doesn’t mean you have to settle for the bottom of the barrel, it means prioritizing what is truly important and will make you happy long term (financial freedom, debt free, staying at home with children) from what will make you temporarily happy (new designer bag, latest gadgets, lunch out every week).
Related: 10 Common Financial Pitfalls to Avoid
6. Plan Ahead
Living on one income will take some sacrifices but it doesn’t mean you can never afford a holiday here and there or a larger purchase. The trick is to plan ahead and save up for those expenses. If you want to go on a family vacation then determine how much it will cost and start putting money aside. If you have a lot of debt then I would highly recommend paying off that debt before you set money aside for those types of novelties.
7. Think Before Purchase
Thinking before you make a relatively large purchase will help keep your spending to a minimum. If you take a few days to think about whether or not you can afford that item and whether or not it is a want vs. a need you will be more likely to make the best decision rather then one of impulse.
8. Be on the Same Page
When my husband and I were married we were given some money as wedding gifts. I thought this was going to make our honeymoon even better, my husband, on the other hand, was excited to pay off the honeymoon (and some other expenses!). We weren’t on the same page about where our money was going! We quickly came to an agreement that would benefit our finances the most and got on board together.
If you want to live off of one income then you need to work out a plan together. If you aren’t on the same page then it will be hard to manage your finances. Plan out a budget together and discuss what goals you want to accomplish financially and how you will do that.
I hope these steps were helpful. Living on less is completely achievable with a little bit of work and a lot of consistency!