Losing a job is never an easy and pleasant experience, and layoffs usually happen without any warning. It’s difficult to start living on one income, especially if you are used to have a few disposable incomes. If you have some financial obligations, you don’t want to damage your credit, risk a repossession or a foreclosure, so you may ask how to meet all your responsibilities. Losing your job is not the end of the world for you or your family! Check out some ways to live on one family income.
1. Prepare in advance
Even if you don’t plan to quit your job, preparing in advance will help you get ready for a financial crisis and stay afloat financially. Do everything in your power! Build your personal savings and get disability insurance while you are still working that will provide some income if you stop working because of an injury or illness.
2. Reassess your budget
When your circumstances change, it’s important to reassess your budget. Living on one family income calls for some sacrifices. Write out your current monthly expenses and monthly income. You have to limit shopping, reduce the amount of vacations you take, and save money on entertainment. Don’t spend money on items you don’t need, and try to save more money of your earnings. It’s better to start a savings account.
3. Make money from home
If you cannot find a job, why not create your own job? Think about ways to earn money from your home. You can clean offices in the evenings, start a home daycare service, become a freelancer or turn your hobby into a business. It’s not a big income, but it can definitely fill-in some financial gaps and keep you financially afloat until you find a better job.
4. Use only one car
Two cars mean two car payments, more personal property taxes, a higher car insurance bill and fuel costs as well. So if you or your spouse suddenly become unemployed, try to use only one car. This will save money for other more important bills.
5. Give up credit cards
When you are living on one family income, it’s so tempting to charge such items as groceries, clothes, furniture and entertainment. However, you should understand that using credit cards will complicate your situation and you will spend lots of money paying back your creditors. Give up your credit cards and start using only cash.
6. Look for cheap family fun
If you live on one family income, it doesn’t mean that you must sacrifice family fun and activities. Just get creative and look for cheap family fun. Read your local newspapers and you may find a lot of free activities in your local area. Have a picnic, go to a state park or a museum, or attend a free concert.
7. Move to a cheaper house to save money
If you or your spouse cannot find a job and it’s hard for your family to pay rent or mortgage, think about selling your house and moving into a cheaper home. It can allow your family to stay current with expenses, and save some money.
It takes some time to adjust to less money, but making some sacrifices will help you with the family finances. Do you have any tips for living on one family income? Share them with us, please.