How to Live On One Income

This post originally ran on March 20, 2008 (under a different title), but since I only had a couple hundred readers to share it with at the time I thought I would run it again.  I’ve also had a few people ask about how to live today on only one income, so it seems this is something more people are considering.  As you will read below, it can be done, but not without some sacrifice.

Nearly a full year into our marriage we found out my wife was expecting our first child. Since my wife relocated when we married it meant a job change for her, and for the first couple months we were married she struggled to find a job comparable to the one she left. She had only been working a few months when we found out she was pregnant. I remember the range of emotions I felt as a “soon-to-be-dad” – excitement, joy, and sheer terror! Not only did I have the normal doubts about my parenting ability, as any new parents would have, but I also wondered how we would manage on one just one income. Before marriage my wife and I agreed she would stay home with our kids, at least until they were school age.

Unfortunately, in hindsight I realize we failed to put in enough planning for this drop to a single income. I was low on the totem pole in my career, and was barely earning enough to take care of myself when we married. My wife’s added income made us comfortable, but we were not savers by nature, so any gains we made were squandered on newlywed purchases – a new car, new clothes, things around the house, etc. We should have been piling up cash like crazy in anticipation of her departure from full-time employment (well, paid full-time employment – being a mom is a full-time job!).

At five months pregnant my wife came home because the stress of her job was taking a toll. The last trimester of her pregnancy was difficult, as was the delivery (in fact, I almost lost both my wife and daughter that day). After an emergency cesarean delivery and a long recovery for mom and baby (neonatal ICU for daughter, long hospital stay for mom and daughter) we finally came home nearly a week after my daughter was born. It was an emotionally taxing time for everyone involved, and the last thing I wanted to think about was money.

We spent the next few years spoiling our little girl, paying minimums on medical bills, eating out frequently, traveling to see the in-laws, and spending all of my salary (and then some). That salary didn’t change much those first few years as my company had maxed out growth and even began rounds of layoffs. Fortunately, I avoided getting a pink slip, but went two or three years in a row with no raise and no chance of promotion.

We finally broke out of the mess when I took a new job in a new industry and relocated, but the damage was done. We now owed credit cards, medical debts and left over student loans from my first two years of college. My wife was now expecting our second child, around the time our first child was heading to school full time. It was clear my wife wouldn’t be returning to the workforce anytime soon, and we would have to continue living on one income. It was a sobering wake up call, financially.

With the benefit of 10 years of hindsight, I offer these tips for one-income families (or those considering a move to become a one-income family):

  • Before making the move, pay off debts and stack up some cash in a high-yield savings account like ING Direct. If we had it to do over again we would have made a stronger push to be debt free before my wife quit working, and we would have had a sizable emergency fund that could have helped with the labor and delivery expenses, and future emergencies thereafter.
  • Stay away from new cars. Car dealers love new parents because they can usually sell them on safety, added space, and “convenience” features. Don’t be fooled. There are plenty of safe, roomy, convenient options in the used car market. Remember, you are living on one income – you can’t afford a new car!  Start your car search with a free price quote at Edmunds.com.
  • Do not underestimate expenses for the stay-home parent. With someone occupying the house more hours of the day, utilities will likely increase. It is no longer feasible to set the temperature to 80 in the summer and 60 in the winter during the day. The family pet will appreciate the gesture, but you will pay for it when the energy bills arrive.  While employment expenses obviously decline, other expenses do go up.
  • Do not attempt to keep up with two-income families. We made this mistake because several of our friends were two-income families, and they frequently bought new cars, new homes, new furniture, etc. We tried to keep up initially, but eventually realized they had more disposable income than we did and we had to adjust down.
  • As a stay-home mom or dad, look for ways to be a “home economist.” Cook meals from scratch, clip coupons, make homemade crafts, or even start a garden. In other words, look for ways to save money that you probably wouldn’t have time for if working a full-time job.

Being a full-time parent can be a rewarding experience, for both the parent and their children. However, it does not come without sacrifice. Plan accordingly so you can enjoy the process, instead of resenting it because you are struggling with money.

Comments

  1. We had difficulty going from two incomes to one as well. Fortunately we didn’t have any debt but it was hard to learn to cut expenses and sacrafice a lot!

  2. Some wise words there. Currently I’m single (ie. no kids on the way) but I still strongly agree with you when you mention about keeping up with two income families. I feel I’m at a disadvantage since I have less earning power and am taxed higher on total income.

    Ah well, my powers of saving more and spending less will keep me ticking along nicely.

  3. “Do not attempt to keep up with two-income families. ”

    This may be the most important advice in this piece. If we look at the majority of our spending, most families find that they buy things not out of actual necessity for the family but rather based on what they ‘think’ they need. Society has done a phenomenal job of conditioning us to think that we NEED lots of different things. The truth is that we can make do without much ‘stuff,’ yet because our friends and neighbors have, so must we. Avoid the Keeping Up With The Joneses. Especially on a single income. This is a universal frugality rule that rings particularly true in this case. Nice article.

  4. Best advice I ever heard for a couple who was preparing for one parent to stay at home was this:

    If you’re planning to be a one-income family, wait. Wait one year. During that year, both parents continue working. However, you save absolutely every cent of the second income.

    Think about it; in one year, you’ve actually tested whether you can live on one income without having to quit your job AND you’ve got an entire year’s worth of income in the bank.

    • We did this and it really helped for a while. However, the comment about utilities is an important one and we failed to plan for that. Our utilities nearly tripled, not just because of the fact that we were home all day but also because of new technology, etc, that ate up electricity.
      We, who started out debt-free, ended up with barely enough money to cover the minimum payments on our cc. I would counsel young parents to plan that expenses will go up, while income will not. Pay attention to the nation’s economy because it will affect your FAMILY economy. Our current home was purchased to meet the “living within your means” category. However, expenses have increased while our income has DECREASED. We are not in a position to sell the house and look for something cheaper so, it’s a bit grating when we see advise to “live within one’s means”. So, I repeat, young couples: plan for worst-case financial scenario and stash as much cash as you can.

  5. We’re currently evaluating exactly this. Mid 20s, married, and trying to find the right time to start a family.

    We’ve built the emergency fund up. The next step is to attempt living just on the one income, and saving more to replace any of that gap after she quits working.

    Thankfully my income is 3x more than my wifes, so it will be easier to let go of her’s when the time comes.

    Great post

  6. Having read this article back in March and again now, I am still left wondering about these particular sentences:

    “Nearly a full year into our marriage we found out my wife was expecting our first child.”
    “She had only been working a few months when we found out she was pregnant.”

    Now for some reason when I read these, it sounds as if someone had delivered you two a message in the mail letting you know that you were pregnant and it was a complete surprise. It sounds as if you were not expecting it. Seeing as how it is the 21st century, we do know that pregnancy isn’t caused by magic or shooting stars. You two had to have been trying for a child and I would wonder if, for one second, you had stopped to think about what life would be like after the birth of that child. It almost sounds as if you jumped in with both eyes closed. One has to see that expenses would go up and income would go down. At least for a significant period if nothing else. Granted, hindsight is 20/20, but there’s something to be said for at least a little planning.

    It also sounds like you went with popular opinion and “had kids before paying off the credit cards” (http://frugaldad.com/category/kids-and-money/).

    “Pff, who needs to pay off debt before having kids. My kids will inspire me to pay off debt!”

  7. We spent the next few years spoiling our little girl, paying minimums on medical bills, eating out frequently, traveling to see the in-laws, and spending all of my salary (and then some)

    that was us!!! (and probably a lot of others too!)

  8. @DavidK: That’s kind of the point of this post–it is a list of “lessons learned.” My wife and I were young parents, and we made our share of mistakes. Yes, we did have kids before paying off debt and building an emergency fund. We had hoped my wife could work longer into pregnancy, but she wasn’t able to, so it short-circuited our plan to pay off remaining debts before the baby arrived.

    Like most all of us, we got a little smarter with age, but I still wouldn’t change anything about the decision to have kids when we did because they remain the most wonderful blessings in our lives.

  9. I am currently a stay-at-home-mom and for our family this is the CHEAPER option. We found that the money I made would barely cover the costs of daycare, gas, and other expenses of working. Many of our friends feel they NEED two incomes, but many families do not consider the extra costs that come with having a job.

  10. I’ve just recently found your blog and I love it!

    I would add: have the BEST EQUIPPED spouse handle the bills. I have always been better at keeping up with payments/budgeting, etc. and my husband is fine with that. He never second guesses me when I say it’s time to tighten the belt.

  11. wow, thankyou frugal dad – it is about time someone wrote about the mistakes they made and the reality of not being prepared for kids! Most financial articles are so full of this is what you MUST do to prepare for kids but not giving the inside reality check. Our life with kids begain in total and utter chaosness and no preplanning whatsoever! We weren’t married so wasn’t doing the “planning” of having a family, we were in the process of preparing to set ourselves up with a home, get married then think about having little munchkins! Not the way things worked out! We built a house, had a baby, got married, I became a semi-stay at home mum (worked 2 days a wk) all in the one year! we were lucky – it was a kind of forced frugality. The most important point you bring to the table is that life can have unexpected outcomes and that you shouldn’t keep up with the two income families. Even today with 3 kids, me being a fulltime stay at home mum – I am asked how we do it? the answer is easy – my priority is to stay at home and that is the core basis to our lifestyle and we build around that aspect – ie not keeping up with the two income families and the jones’s. Anything is possible even with out being fully prepared – you just need to be focused on what is important for your family.

  12. Great advice! We went about it all wrong too… had our first before getting aggressive with our debt. Fortunately, before our trio came along 17 months after the first was born, we were well on our way to being debt free. Once that mentality finally took hold we were able to conquer our debt. We’re still working on the savings now. With four girls incredibly close in age, we’ve got a feeling we’re going to need lots of cash in our future!!

  13. We just recently (Labor day weekend) went to a one income household. My wife was killing herself trying to work and be a mother to the 1 year old. When we looked hard at what she actually brought home, minus daycare costs, minus transportation costs, minus extra income taxes and mostly minus the 6000 a year we have to pay out of pocket on our health care since he gets sick every other day at daycare… it turns out she was working for about 2000 dollars a year. Not worth killing herself over.

    Now, just 3 weeks later, my boy is very healthy, much more calm at home, developing much faster (he is now doing sign language for communication) and momma is actually rested and not worn out.

    Unfortunately it took us a year to figure out we were just spinning our wheels.

  14. It has always been my rule NEVER to tell a realtor what our income is because they’d try to steer us to much more expensive houses and we’d be stretching to make payments and keep up with the taxes and utilities.

    My other rule is to extend the home warranty each year. It is an expense, but I’ve been a single mother for the last 12 years and was disabled three years ago. I am unable to do simple repairs any longer. If something breaks, or clogs, or leaks, I just call for service and pay one $55 charge. If the item needs to be replaced, the warranty company covers all parts, I just pay labor. I had a new furnace installed in my last house and my total cost was $700.

  15. As always, this is really great advice. I think we overlooked the preparation part because we had been without employment for so long, but I tried to kick in by being a good home economist to make my husband’s paychecks stretch. I definitely think your last point would be great too for earning income. I think women underestimate their skills and the value they could get from them. Charging for your services can also help families too. If you can sew, why not charge for mending services. If you are great at crafting- try and start a small business and sell your wares to local shops. It requires some self-confidence and research, but women can feel really empowered if they are able to contribute to the family in these ways.

  16. Very interesting but unfortunately you like many other blogger are helping perpetrator the myth that America is broke because they bought too many toys. Not true the cost of clothing, appliances electronics and even cars have decline 50% over the last 30 years. America is going broke on two incomes because the cost of housing schooling and health care have soared along with income insecurity. Nothing worse than losing you job in your 50′s.

    I suggest watching the Elizabeth Warren lecture

    here

    It’s an hour long but very very interesting.

  17. Here’s an example, my niece lives in Southern Ontario and to live a comfortable middle class lifestyle one needs a family income of 60-70 thousand a year (that’s a starter house with a mortgage and two cars) yet they both only earn around 35 a year. No matter what way you slice it they can’t afford to live on one income.

    So question is do they have a family and let day care raise the child or do they skip having a family.

    It should also be noted that in the last five years house prices more than doubled, making it much harder to afford a house on one income.

  18. After making the comment I thought I should email my aforementioned niece and run the numbers by her. I’ll do that and get back to you, but I believe they are close.

    My big joke is “sure Canada has private health care, you just got to cross the border to get it”

    Europe home of the Nanny State (UK in particular) and socialism (everywhere) public and private health care exist side by side. I have private health care in Spain (in order to access English speaking doctors) and no one blinks an eye.

    Elizabeth Warren makes an relevant comment in her lecture. She said 30 years a baby meant spending 5 days in the hospital and C section meant 10 and you left with 99% of the bill covered. As frugal dad mentioned his wife spent 7 and left with tons of bills.

    Even if you don’t agree with all her points her lecture is very enlightening.

    BTW frugal dad how do you manage to work and blog at the same time! That’s a tough haul.

  19. Whoa there Rob. I know you’re on another continent and all, but Ontario is in Canada not the US. They have nationalized health care and other such wonderful government programs to help all their poor, poor citizens out. And you’re going to tell me that those people cannot live on less than 70K per year? I would guess not since their tax rate is far higher than ours and a good chunk of their income is appropriated before they even touch it. Watching the news circuits and listening to pundits debate topics is not the way to know what is actually going on in America. I listen to the news every day and hear how everyone is going broke due to gas prices and no one can afford a house anymore. This is strange since I see even more cars on the road every day, realtors are still in business and everyone around here is generally happy. I’m not sure whether the news is actually perpetrating a shift in our general attitude towards the state of America (thereby making it worse than it really is) but I wouldn’t bet against it.
    Despite the people who want to make out private health care to be an evil thing, it’s still the best thing going on this continent. All the time citizens from Canada and Mexico illegally cross the borders in order to take advantage of our private health care system. Plenty of times they do not pay for it (therefore stiffing the rest of us with the bill) but other times they do. And they are grateful to do so because they see that it is far better than their country’s alternative. I’m still waiting on someone to explain that one to me since private health care is soooo evil.

    Apart from major cities, here’s an idea of how it’s going. House costs have only risen about 15-30% in most places in the last 5 years. This is the standard appreciation of home values over time. Public schooling is still basically free and is quite good in many places. Health care costs haven’t really soared but it all depends on how sick you think you are and how many pills the doctors want to push down your throat. There 4 times are more medication commercials now than there were 10 years ago. Here’s an interesting fact that I learned from a medical expert a while back — the rest of the world doesn’t really put much money into medication research because America spends billions doing this already. They simply either buy the formula or reverse-engineer it and just make the drug. Therefore other nations and other health care systems don’t have to incur much of the cost. They benefit at the expense of America and its citizens.

    • The Canadian Who crosses the border is really rare and the one case I know of our health care system covered it because there was no were near by that did what she needed . I personaly love our health care system. When I had my C-section the last thing on my mind was how much it would cost. I was absoloutly floored by how much it would have costed in america when my friends cross border told me. Every one gets equal treatment regardless of income . Private is ok If you make alot of money , have benifits at work or are healthy , But nobody goes bankrupt from needing surgury or having a baby. Big private companys will show the odd story of a person who crossed the border but think about it , its about money and then they would only be able to charge what the goerment is willing to pay, and the doctors are still paided ery well here but not the insane pay that you guys pay from your personal pockets from And I did remember an artical i read a bout a year ago were older peolpe would spend and hour or two trailing to canada or mexico to but their drugs cheaper here.

      But dont take this personaly I just love my country and i belive in the system , most of our medical problems are from not having enough doctors that we hae to imagrate alot of them from south africa, And they are very good. Very good artical on stay at home parents by the way.

  20. Thank you for pointing out that there are expenses associated with having a parent stay home. Too often, I see list stating that a stay at home mom will save on clothing and haircuts because they won’t have to dress up for work each day. Huh? Can a stay at home mom not look nice also? Same thing goes for saving money on lunches. Yes, you’ll be at home so it’s convenient to just whip up sandwiches, but there are times where you might want to take your kids out for lunch or ice cream. Gas is another one, you are no longer driving to work, but you are taking the kids places throughout the day.

    Sure, you will probably be spending less in these areas, but I think that in reality the difference in spending in such areas will be minimal.

  21. @Rob: Working and blogging is quite a chore! In fact, it is nearing the point where something will have to give to continue growing my blogs and continuing other freelance gigs. There are simply not enough hours in the day.

    I work on the blog early morning hours, and sometimes late nights and on Saturday mornings. Essentially, it is my part time job, but one that allows me to stay near my family and not be away four nights a week working retail (been there, done that!).

  22. I was always taught that even tho there were two incomes, one should always always live on only one income and save the 2nd. Period. (In case of pregnancy, in case of illness, in case of job loss, etc) And my opinion has not changed. Altho I only have one income now, I still try to live on just half of it. It was good advice that has stood the test of time.

    When the 3 kids were little, I gladly quit working to stay home. There was no way when the 2nd child came along that we could have come out ahead with the cost of day care, etc. We came out way ahead with the 2nd child by my cooking from scratch and sewing a lot of the clothes. With 3 kids we had no more home expenses than we did with 2 as I had become very good at making do by then and stretching the dollar further. Plus I got to enjoy their growing up so much more! :)

  23. Wow, some really good points in this post. I am also glad that you mentioned “the costs of staying home”, because people are more interested in pointing out the costs of working.

    I am well aware of the costs of my daycare, the second car and upkeep, gas bills, etc. And although I work, I do remember what it was like on maternity and on vacation days at home.

    We use a lot more water when I’m at home. Drinking, flushing…I get free water, tea, and well, flushing at work. We can keep the house unheated/uncooled during those hours too.

    Also, I get bored at home. In order to “get out” I’ll go to the park. But it’s also really hard for me to fight the urge to go shopping. Even though I hate shopping. I’ll just go to the grocery store to look around. Buy a soda, a piece of candy, whatever. Which I don’t do at the office. Being at home with a 2.5 year old who refuses to take a nap can be difficult, and I need an “outlet”. Plus, not all of us have “looking good” expenses with working.

    Also, when people say “you can’t do it on one income anymore because of housing costs, etc.”, they are right and wrong. For one thing, a “middle class lifestyle” today is very different from one in the 70′s, when I was a kid. We had one car, one meal out per year, a very small house, no big vacations, hand-me-downs, 3 TV stations…

    A “middle class lifestyle” today is different. If you were to live in a small house or condo, people would consider you to be living a “lower-middle class” lifestyle. Go without cable TV? Never eat out? I do know people who live this way, and I admire them. But a lot of people think they are weird, or poor.

    Costs of schooling have gone up, but so have expectations (I was the only one of 9 children to attend college right after hs. Three of us went to school, and we all paid our own way.)

    Health care…yes, that has gone up. But you know, I remember having surgery in 1982 at the age of 12, and seeing the $6000 bill that insurance didn’t cover, and watching my parents make $100 payments each month for 5 years to pay it off. As much as my mother pays for pills…she takes 20 per day, my grandmother at her age took a lot fewer. And my mother doesn’t take care of herself either.

    If necessary, we could survive on my husband’s income alone. It would be really tight, but we could do it. I have a friend who would really love to stay home. She ran the numbers, and can’t do it for two reasons: 1. they bought a bigger house than ours, and their mortgage is $200k more than ours, and 2. they spend more money on other stuff.

  24. We are making it! My wife and I have one beautiful baby girl (who she stays home with), we make less money now than we ever have before, but we are still saving, plus we bought our first home. Did I mention I make $40K/year? Here’s a few tips: Avoid packaged foods. Is this hard? Yes, but you will eat better and save a ton. Only have one car if possible. I’m taking the stinky bus now. Don’t eat out more than once a month. Another tough one but totally doable. Never charge things you can’t pay off within the month. That’s money out the window. Good luck!

  25. I asked my Niece about this and her’s what she wrote

    Sounds right, we both only make 32, which means we take home about 44k a year COMBINED. but what you are saying is something we have to look at….

    for example, lets say we did go down to one car… do we
    1. get rid of the 5000 car, that we owe 5000 on, that will last us the next 5 years if we really push it, or
    2. get rid of the 16000 car that we owe 16000 on, that will last us the next 14 years?

    Then, there is the income. If I did stay home, we wouldn’t get taxed as much because we would have 2 dependants on one imcome….. then again, why should I stay home? who has a better earning potential, will I be happier staying home, or would Robb?

    Dont forget, we have FREE daycare, I dont know many people who will have that. I cant say that enough FREE

    but here is the reason we cant stay home: Debt. My entire income, and a third of Robbs goes to debt. That is it period. If we didnt have any debt, it wouldnt even be a question that one of us would stay home, but becuase education is so pushed we both went into debt getting an education that has yet to pay off. although we have both paid off almost half of our student loans, it still leaves us with a lot.

    So why dont we bust our arses paying off debt for the next 5 years and then have kids. I dunno. but most of it has to do with not wanting to have kids in our 30′s and that fact that we both are almost in tears making ourselves wait until Jan to have kids because our hearts ache for them now. but waiting would be the responsible thing to do. or would it? We COULD re-arrange our finances to make our debt a little more dormant over the next decade of our life, but then what? then our kids will be teenagers and require even more money…? its a what if we have been playing with since we got married and its eating us up….

    Thus our current, very intense dilemna.

    I should add that they are both very frugal, I was quite impressed with them. they bought a reasonable (but still very expensive) house outside of town and furnished it with used stuff. Problem is debt they ran up when they were really young and foolish.

  26. I am a financial planner and often encourage young married couples to learn to live on one salary from day one of their marriage and use the other spouse’s salary to pay off debt and build up savings. That way, when children do come into the picture, they are already comfortable with living on one salary and the wife has the flexibility to either stay home or continue working and they don’t have to radically adjust their lifestyle.

  27. @Rob: Sounds similar to the situation my wife and I were in. We ran up debts for education in our late teens and early twenties, and had kids anyway. We have managed to live on one income, and could have been quite comfortable had it not been for debt. As it is, things will stay pretty tight until we are debt free.

    Thanks for sharing this.

  28. Rob, I am very impressed with the thought process that your niece has gone through. It’s hard to make up for foolish decisions you made when you are younger.

    Her most important comment about staying home is “why? what if I don’t want to?” (Which is why I don’t stay home.)

  29. We took two important steps before having kids: first, we qualified for our mortgage on one income only. We could have gotten a much bigger, more expensive home on two…but knew it would be foolish to depend on my income when our goal was for me to be able to stay home, or work part time at the most. The second was to utilize my direct deposit flexibility to gradually get used to living on less money. First, I’d divert $200 from each check to savings. Then $300, then $400…by the time I was ready to go on maternity leave most of my check was going to savings, and we had a nice cushion.

    I give those two pointers to anyone who will listen…we had virtually no financial shell-shock because of them.

  30. great post. My husband makes 3 times more than I do. But Ive been able to help a lot with the expenses when clients delay their payments (we both are freelances). but now Im thinking about quitting my small business and dedicate myself to my blog and the FULL administration of the house and his income (except for his expenses, of course). Im very skillful with budgeting, planning etc. And then maybe (if we phisically can) have a child next year.

  31. It always amazed me that someone could live on $50 a week for food, I know America is cheaper but I didn’t think it was that cheap.

    I told me niece two things, one being young and broke is normal (particularly when you add kids) and secondly make the Tightwad Gazette and blogs like this your best friend. Savings aren’t measured in dollars but in pennies. It can done but it’s not easy.

    I would add the hardest part about being broke is the feeling of being deprived. That was a big struggle for my wife and I

  32. HI! I am a single mom, thus have had to work, but I live on very little. Of course, I know GOD makes it all possible.
    But I have managed to live on $20,000 or less for the past 5 years without accuring any debt in that time. My rent was over $1,100 for 3 years of that time with no subsidies or anything! (I live in NJ, very high cost of living.)
    I ran an in home daycare to avoid daycare costs myself (I also happen to love kids.) I also have an older car (in the past 5 years I have had 5 cars, one was $250, one was $500, one was $300, and two were free from some church members- repairs and maintance costs me about $700 a year.)
    I make alot of our food, we use about $50 a week for groceries (for one adult & two kids ages 10 & 5-my 5 year old eats alot.) We have a veggie garden. We have veggies and fruit daily (from garden & store bought.) We eat out about one time a month, or my boys use there allowance for eating out if they want to. We do alot of free entertainment in our area.
    Our vacations are camping and such.
    We do not have cable at all. We have basic phone (no long distance, voice mail, caller id, etc.) My mom does pay my cell phone bill – we are on her family plan.
    We wear hand me downs (that are nice & clean.)
    We barter for childcare (if I have a class or want to go out.)
    We utilize the library for dvds and books.

    It can be done, and the best part is we enjoy life
    and we feel so blessed. We have never gone without a need, and have many wants as well. We just save up for them, or someone blesses us with them. Plus I am with my kids most of the time.

    Now, we have a great church and local family which is also very helpful. I could not do it all without them (& God.)

    But the most important thing is that we give back to God, it’s all His money anyway, and so many are worse off than us, it is the least we can do.

    Thanks for your blog, I really enjoy it and read it often. -Becky in NJ

  33. This is great advice. The other item would add is that if you are on one-income, always keep in mind the downsizing issue. I have countless friends going through this…went to one income and now their employers are cutting. Talk about serious stress….

  34. Great advice. We were lucky to have 12 months to plan on my wife quitting (8months about 4 months maternity) so we had time to plan a small business

  35. We are a 1 income family I had to quit my job due to my sons has many problems. We also had to make choices we couldnt afford to take a vaca all the time like the 2 income family so we bought a camper and have a seasonal site it costs a lot less with a family of 5. We have only 1 new car and saved so we could put down a very large down payment We didnt but the bigger house with the bigger house you have bigger bills taxes heat ect. We have many friends that say your so lucky and I tell them no its not luck its we work together and make choices.

  36. The other thing that is never brought up. The husbands earning power (and occasionaly the wife) Unless he’s got a good wage there is no way you can live on one wage. In southern Ontario you pretty much need 50-60 grand a year to survive unless you have very cheap rent or no debt. My brother in law earns abit over 50.000 needs to work partime evenings and the wife had to bring cash in for holidays.

    Another thing that has changed since the 70s the single income single car family, seems that todays family can’t surive with only one car. How you can live on one income and have two cars is beyond me

    • Location I live in northren british columbia in a smaller town to so a house that is one million in vancouver is about 100,000 here hand wages are good. we would love to live in a bigger place bug wages seem to go down and expenses go up. I seem to br living in one of the last area it seems in north america that one parent can make enough and meet expenses have hope of owning a house and make about 40 grand a year . Their are quite a few stay at home moms here or moms that work only part time.
      Im not going to lie it is still very tight with hydro gas and food going up still. I think I might be the last generation that will even have it has an option at leat in the middle class area.

  37. We have a stay-at-home dad, and I’m the go-to-work-in-an-office-mom. Here’s my tips:

    1. Cut off your cable – in Toronto that saves us about $50 a month!

    2. Go for cheap, cheap internet – do your research and there are many cheaper options that the big names out there – ya, the service ain’t the best, but we are paying about $15 less per month

    3. Join the Y! Rather than forking out tonnes for a zillion different afterschool programs, pay a flat fee for the whole family that covers a whole range of options. From swimming lessons to Taekwondo, to Yoga, Pilates and more – the Y keeps us busy

    4. Babysitting – do babysitting exchanges with family or neighbours – you take their kids one night then the next time they take yours. Gives you some precious time with your spouse rather than worrying about paying for every hour. Our neighbours used to do this and just head over to the book store to browse for an hour or two.

    5. Public Transit! Need I say more – the price of gas is killer. Only use the car when you have to. Shop locally – walk, ride your bikes. Support your local community stores versus bigbox. Ya bigbox are sometimes cheaper, but what about local fruit/veggies stores? They’re always cheaper than the grocery store

    6. For the working parent – ALWAYS pack your lunch. Never buy at work – seriously – you spend $7.50 on a good sandwich you could make for $1.50 at home.

    7. Shop off season – for the kids (yes I admit I’m the exception) – buy next years’ summer clothes at the end of this years’ summer. Take advantage of all the sales that are even better than 50% off. Sure this won’t work as your kids get a little older and start to be more picky about clothes, but for a 5 year old boy? Stock up!

    8. Shop at the Thrift Store – so many amazing clothes can be found at the Thrift Store – again you gotta make sure your kids aren’t the picky type, but with the young ones this works great

    9. Books – only buy them at the Thrift Store. We just bought about 50 Archie comics and Goosebumps books for 25 cents each… enough to last a year! New books sometimes come for birthdays, but for fun, everyday stuff you can’t beat the Goodwill.

    10. Furniture – I LOVE Ikea as-is. Its the exact same furniture but its 1/2 price. Seriously – the furniture thats returned and has already been built is just marked down because they don’t want to take the time to disassemble it and pack it up again. I know, I used to work there. Be patient and visit often – eventually the item you’ve been fawning after will show up in the as-is

    11. Meatballs! Okay, this is totally nerdy but we go “out for dinner” with the kids to Ikea. They love it! $1.99 meatball dinner for the kids, then they go play in the free ball room for an hour and the parents get to browse Ikea. Its like free babysitting!

    I could go on and on… sure I would love to have the money of a 2 income family, who wouldn’t? But to give up the fact that our kids always have one of us around when they’re not at school is the most amazing thing ever.

    sue

  38. mad sow’s argument that because his wife only made $2K a year, that she should quit spinning her wheels for nothing:

    “When we looked hard at what she actually brought home, minus daycare costs, minus transportation costs, minus extra income taxes and mostly minus the 6000 a year we have to pay out of pocket on our health care since he gets sick every other day at daycare… ”

    is the wrong. the combined income should be looked at, to see whether the combined total makes it worth her continuing to work. i see this argument again and again and it’s just the wrong way to look at things because she’s not working/earning money in a vacuum. you’re both bringing in money.

  39. @Rob – I think it all depends on where you live and how you live as to how much it takes to survive. I am a single person household, but I have my grandkids every weekend while their Mom works, and one evening after school while she goes to college – so just electric, water, food, some gas, and some entertainment costs, besides my own.

    I EASILY get by on under $20,000 gross per year – that’s about $1000/month take home pay.
    And I have both a car and a pickup truck.

    The secret is tho, that I am debt free, altho I could swing a car payment or mortgage payment if need be out of what I take home. It can be done!

    12 years ago I made a whooping $29,000/yr. (That’s the highest wage I ever made) (Too stressful – I quit!) Out of that I was paying a mortgage and a car payment – tough, but I did it. I didn’t feel deprived, but others might. I just felt I was doing what I needed to do to live off what I made and still save some for the future.

  40. I don’t have time to read through all the comments so maybe this was already mention – but I think it is worth mentioning again. Shortly before I got pregnant (surprise!) my husband lost his grad student funding – which wasn’t much to begin with. Then a couple months later the company I worked for, as a contractor, went under and we were a NO income family. Both of us scrambled to find jobs but I could only get temporary work as most people were unwilling to hire a pregnant woman. We basically lived off of savings and Christmas money and, thankfully, had always lived very cheaply before. I think people kind of lose their minds with all the shopping that can be done when you have a baby. We didn’t spend one cent outfiting our home for our daughter – everything was either given or off of Freecycle. So many people buy new stuff that I figured we didn’t have to. And the other thing is that babies really only need a couple things: Mum’s boobs, or formula, diapers, some clothes, and lots of love. I’m nursing and we are using cloth diapers which has cut down our costs considerably. Thankfully my husband has JUST NOW found permanent work and we don’t feel so destitute but at least we know that we don’t need to spend lots of money to be happy and make our daughter happy.

  41. very interesting discussion, I’ve been emailing my niece encouraging her to spend time on the various blogs. She’s really discouraged about debt and money. I told her blogs (like this) have been a life changing experience for me, not just for the ideas, but also to know your not alone. I sometimes shake my head at how we could have wasted so many years then I read blogs of people who’ve done the same and I don’t feel quite so alone.

    @ Marci I assume that you have a paid for place. I do agree one can live very comfortably on much less money, particulaly when your not up to your ears in debt.

  42. @Melanie – Thanks for saying what I couldn’t have said better about raising babies and about cloth diapers! Great story!

  43. fter getting married and having 3 boys the guily was getting to me. My hubby and I both made over 65G a year. We planned it, paid off our cars and bills in a couple of months, and you know what we have found out after a year of being a stay at home mom? Nothing has changed, except we have less garbage (seriously) because we are not wasting our money on crap or laziness. It is far cheaper to plan meals and family outings than spendingt too much money on last minute food and fun. We even made it to Disney for 2 weeks this summer, that was our first vacation. It’s all in the planning….

  44. I liked reading this because my husband and I are currently “living” on one income. When we found out we were finally going to be blessed with a baby we put our savings plan in full gear. We had been saving for emergency costs and a house because if it’s one thing we’ve learned since our marriage two and a half years ago its that when it rains- it pours. But so far so good. We only started about a month ago and are able to put away almost $2000.00 this month by saving my paycheck every two weeks, and whatever is “left over” after my husbands paycheck comes in every friday to keep our “necessity” account aka checking account budget lower, and giving ourselves only $20.00 each a week for “unnecessary” expenses (lunch, coffee, whatever you choose). I looked over the bank statements and found that we were spending WAY too much money on food, coffee, impulse shopping sprees and hardly anything at all on our weekly gas and grocery bills. So I dropped our current checking budget from $1,000.00 a week to $600.00 a week for necessary expenses. So I knew that if we could keep our “want” purchases at bay, we would have no problem keeping money saved up.

    At first it was hard to adjust to the new necessity budget and holding on to just $20.00 for the whole week (Sunday-Saturday). But now that we’re settled and used to it we’ve been able to save that extra $20.00 by not even bothering to purchase anything that is a “want”. We try to spend a night out doing something for the both of us, like a movie or small dinner. But we’re trying so hard to put as much money away as possible before this baby comes in August. We know babies are expensive and plan to make our own baby food, I’ll be breastfeeding, we’ll use cloth diapers, and grandma daycare :) We’ve been blessed by seeing our friends trying to raise kids on small budgets or who aren’t working at all. We have to budget for the birth, which none of our friends have had to do, they were all covered by the States Healthcare plan so they had 100% coverage. We don’t get foodstamps like all of our friends, so that’s why we plan to make our baby’s food. I always make extra for meals so grocery bills shouldn’t change too much till they get older. We do have to pay for the birth of our child but my company’s insurance is spectacular. I just don’t want financial worries getting in the way of the joy and excitement of our new little one. I think that anyone can do this, it just takes honesty with your spouse and self control. Together you two can rock saving money and feel proud of yourself for being a prepared parent. We plan on staying on the “one-income household plan” even after I go back to work. Saving money for our baby is important.

  45. good info here. i’ve been preaching this for many years now. we have 4 kids and my wife stays at home to take care of them. she could work, but we value the idea of her staying with them rather than pawning them off of a caregiver just so we can make more money. all of my wife’s and my siblings do this so they can make more money to have more stuff, but they are still broke. no one told me about this principle, but my dad was always teaching me about finances. he even had me investing in a mutual fund at age 14. it just has always made more sense to me to base our lives on just my income and then later when my wife goes back to work, we can save her entire salary. how amazing will that be????

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