How to Live on One Income
Prepare in advance if possible., Be aware of the stark fact that working costs money., Realize that when one person is home, it costs less for them both to live., Only use one car., Move to a less expensive house/apartment., Examine your budget...
Step-by-Step Guide
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Step 1: Prepare in advance if possible.
You should try to be prepared for having to live on just one income.
Set aside an emergency fund and only use it for emergencies, and craving pizza is not an emergency.
Think and research how you can cover the cost of appropriate life or disability insurance, and if required health insurance for the whole family.
Try to prepare for these changes yourself, using the internet and free literature from your local library.
If you have the resources and need a little extra advice consider a financial advisor, but they can be quite expensive and usually make commission on products they sell you. -
Step 2: Be aware of the stark fact that working costs money.
Yes, you make money by doing it, but you're not netting as much as you think you are.
There are travel costs (commute, bus, carpool), lunch costs, that cup of coffee on your way to work every morning, and maybe even childcare.
There are a number of different statistics, but working can cost you up to 30 percent of your wage just to go to work, and definitely more if you need childcare. , When two people work all day they are tired, and rightfully so.
There are many things they do not have the energy to do themselves and pay others to do for them.
But when one person is home they have time to make dinner.
They have time to mow the lawn, clean the house, wash the windows, iron the laundry, and walk the dog.
Many of the things dual income earners pay others to do, can be done at home for much less, and usually done better.
Commonly it becomes cheaper for the person still working to keep working.
The person still at home can make lunches, make coffee in the morning, and provide that needed childcare. , Many dual working couples have two cars, because they commute to two different parts of the city.
But if one person is home, they no longer need the car during the day.
That halves your car payments, car insurance, gas, maintenance, car washes, etc.
The person home during the day can go grocery shopping in the evening using the only car, or maybe you live close enough to walk to a grocery store. , With one person home all day, a smaller home can seem larger when it is kept clean and organized.
Also you can move closer to the one income earners workplace, shortening their drive to work, lowering gas costs, and decreasing commute stress.
Maybe even move closer to that grocery store. , Establish a baseline budget by examining your previous debit and credit card statements, bills, and rent/mortgage payments.
Can you cover these costs with only 1 income? Ask yourself what can you truly afford.
You must be honest with yourself.
If you can cover all your basic expenses with only $2 left over, you're setting yourself up for credit cards charges and loans. , Even if you have hardships when living on less, fight the temptation of using credit to make up the difference.
If you have difficulty of paying monthly bills, it will be even harder when you add the interest charges and recurring monthly payments to that amount. , "Dependent" spouses (read "no income") come with tax benefits.
A dependent spouse may be allowed to transfer their basic tax credits to the earning spouse, making the one income go that much farther.
Do research on your own countries tax laws. , Many people who do not work, earn some money.
A person who is home all day can earn a small income by doing odd jobs around their neighborhood.
All those things mentioned in step two that dual income earners pay someone else to do? You can be that someone else.
Maybe mow your neighbor's lawn? Or walk their dog? Or take care of their children one or two days a week.
Many people turn their hobbies into small earnings through websites such as eBay and Etsy. , Even thought your income probably was cut significantly, it's always smart to plan for the future.
Use the internet and resources from your local library to determine the best investments for your situation.
Doing this research will ultimately lead to being more informed and intelligent about any investments you can make. -
Step 3: Realize that when one person is home
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Step 4: it costs less for them both to live.
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Step 5: Only use one car.
-
Step 6: Move to a less expensive house/apartment.
-
Step 7: Examine your budget.
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Step 8: Resist the urge to charge.
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Step 9: Look into tax savings.
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Step 10: Earn from home.
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Step 11: Don't forget retirement.
Detailed Guide
You should try to be prepared for having to live on just one income.
Set aside an emergency fund and only use it for emergencies, and craving pizza is not an emergency.
Think and research how you can cover the cost of appropriate life or disability insurance, and if required health insurance for the whole family.
Try to prepare for these changes yourself, using the internet and free literature from your local library.
If you have the resources and need a little extra advice consider a financial advisor, but they can be quite expensive and usually make commission on products they sell you.
Yes, you make money by doing it, but you're not netting as much as you think you are.
There are travel costs (commute, bus, carpool), lunch costs, that cup of coffee on your way to work every morning, and maybe even childcare.
There are a number of different statistics, but working can cost you up to 30 percent of your wage just to go to work, and definitely more if you need childcare. , When two people work all day they are tired, and rightfully so.
There are many things they do not have the energy to do themselves and pay others to do for them.
But when one person is home they have time to make dinner.
They have time to mow the lawn, clean the house, wash the windows, iron the laundry, and walk the dog.
Many of the things dual income earners pay others to do, can be done at home for much less, and usually done better.
Commonly it becomes cheaper for the person still working to keep working.
The person still at home can make lunches, make coffee in the morning, and provide that needed childcare. , Many dual working couples have two cars, because they commute to two different parts of the city.
But if one person is home, they no longer need the car during the day.
That halves your car payments, car insurance, gas, maintenance, car washes, etc.
The person home during the day can go grocery shopping in the evening using the only car, or maybe you live close enough to walk to a grocery store. , With one person home all day, a smaller home can seem larger when it is kept clean and organized.
Also you can move closer to the one income earners workplace, shortening their drive to work, lowering gas costs, and decreasing commute stress.
Maybe even move closer to that grocery store. , Establish a baseline budget by examining your previous debit and credit card statements, bills, and rent/mortgage payments.
Can you cover these costs with only 1 income? Ask yourself what can you truly afford.
You must be honest with yourself.
If you can cover all your basic expenses with only $2 left over, you're setting yourself up for credit cards charges and loans. , Even if you have hardships when living on less, fight the temptation of using credit to make up the difference.
If you have difficulty of paying monthly bills, it will be even harder when you add the interest charges and recurring monthly payments to that amount. , "Dependent" spouses (read "no income") come with tax benefits.
A dependent spouse may be allowed to transfer their basic tax credits to the earning spouse, making the one income go that much farther.
Do research on your own countries tax laws. , Many people who do not work, earn some money.
A person who is home all day can earn a small income by doing odd jobs around their neighborhood.
All those things mentioned in step two that dual income earners pay someone else to do? You can be that someone else.
Maybe mow your neighbor's lawn? Or walk their dog? Or take care of their children one or two days a week.
Many people turn their hobbies into small earnings through websites such as eBay and Etsy. , Even thought your income probably was cut significantly, it's always smart to plan for the future.
Use the internet and resources from your local library to determine the best investments for your situation.
Doing this research will ultimately lead to being more informed and intelligent about any investments you can make.
About the Author
Alexander Wilson
Enthusiastic about teaching home improvement techniques through clear, step-by-step guides.
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