It is scary going from two to one income or from one to no income. However, there are lessons learned when losing an income.
New Perspective
I went from working full time with a steady income to partial income, and then no income when I had a baby. My husband was working during my fluctuating employment, but we had gotten so used to two-incomes the reality of living off one income scared me. I wanted to be a stay-at-home mom and raise a family, but looking at the numbers it didn’t seem possible.
Change In Focus
Sometimes we focus so much on the money coming in that we ignore the money going out. I was SO focused on income that I didn’t notice the bigger culprit- spending. We were spending almost all of our monthly income when we had two incomes coming in. That’s when I realized: we didn’t have to make more to save more; we had to spend less to save more.
It was during this time of living off one steady income that I became determined to contribute financially. I couldn’t contribute a steady paycheck, but I could find the areas in our budget to improve. I could tighten our budget so no matter what income we had, we would be spending less and saving more. In analyzing our money I discovered we did better with our money by having only one income. Here’s how:
The Importance Of Tracking Your Spending
Automate Tracking
The best way to analyze your spending is to track every purchase you make. I found the simplest way to do this was to keep track on America First. We make all of our purchases on debit card so it comes straight out of our account. America First Money Manager allows you to automate expenses into categories so you get a total amount spent in each category (food/groceries, shopping, etc). We use money manager through America First which allows us to automate our expenses to see the total amount of money spent in each category.
Manual Tracking
If you don’t have a bank or credit union that offers a money managing program but use a credit card, take your credit card statements for the last 3 months and write down income and expenses. It’s easiest to organize these categories into fixed expenses, variable expenses, and other (purchases that are not necessary)
Track As You Go
Want to track your spending as you go? Keep a 3×5 index card in your wallet. Every time you pull out your wallet to pay with cash or card, simply write the total as you are waiting for the transaction to be complete
Identify Needed Changes
For us, after tracking expenses, we needed to learn to reduce our grocery budget. Without knowing exactly how much you spend, you won’t be able to spend less.
Learning How To Search For Deals
More time at home meant I could take a closer look at prices between grocery stores to find the best deal. I learned what items I could buy cheaper like at the Dollar Tree!
How To Cut Unnecessary Costs
Heating and cooling your house can be a huge cost during the hot and cold months. Learn tricks to endure the weather on a budget! Eating out truly is a luxury and not a necessary expense. Reduce eating out with these tricks.
Where To Find Extra Cash
For some, making extra money includes a side hustle. For me, I was able to sort through all the stuff we had acquired over the years and find things to sell, regift, or donate.
Some may find that their extra cash comes from side hustles, including babysitting, Uber/lyft or couponing. For me it was blogging!
Reducing spending not only helped me contribute financially but alleviated my fear of losing an income and only living off one income. Take control of your finances so you can enjoy financial success no matter how much income you earn.
