Many of us are seeing a reduction in family income, fearing job loss, and an increase in debt. In such a scenario how does one live on one income in a two-income world? When we went through our first phase of reduction in family income, it was a huge learning curve for us. We had gotten used to a comfortable lifestyle and downsizing was not easy. This time however we feel more prepared to deal with an income loss and the transition back to living on a tight one-income family budget has been relatively easier. If you are wondering, how to live on one income? You are at the right place. Today I will be sharing how we manage to live on one income while still saving a little on the side.
These are frugal living tips and tricks we have used over the years during periods of low incoming cash. Hopefully, these are tips you need right now, and even if you don’t necessarily need to live on one income, these are useful to help you save for the future and reduce unnecessary spending.
How To Live On One Income
- Make a family budget
Even before deciding on a family budget, you need to create an emergency fund. This is ideally money that is kept aside and left untouched. The money from an emergency fund can be used for unforeseen medical expenses, major home, and car fixes, or in case of an extreme money shortage. You must also prioritize getting the emergency fund back to the original amount when used. Many experts believe that an amount equivalent to 3 months of expenses should be enough for an emergency fund.
A family budget should account for monthly fixed expenses, debt payments, if any, and other variable family expenditures. Once you get an idea of how your money is used, you can then decide where to cut costs or distribute the money.
I recommend apps like Spendee to track your monthly expenses. The insights this app provides help in gaining a better understanding of how you spend your money.
- Cut down unnecessary subscriptions
Review all the subscriptions you pay for. Be it digital subscriptions or cable T.V and internet. Most of us have 1-2 subscriptions that on assessment feel like a luxury spend. Cut back on these. For eg., instead of subscribing to 3-4 streaming platforms, choose 1-2 platforms that you use the most. On a monthly basis, these look like small payments, but they add up to big amounts in the long run.
- Build a minimalist wardrobe
Building a capsule wardrobe with a few minimal pieces is very useful in saving money in the long run. Invest in good quality pieces and choose classic designs that don’t change according to fashion seasons. This way you get the most use of your clothes and save money.
Read here to know more about how I built my own minimalist wardrobe and my experience living a low-buy lifestyle for a year.
If you have children, building a capsule wardrobe for kids also comes in handy in curtailing unnecessary expenses on clothes and accessories. Find a good thrift store close to your location or resell old clothes to earn money back after your children grow out of these clothes.
- Eat mostly plant based
Switching to a mostly plant-based diet saves a lot of money. In my post on budget meal planning tips I had mentioned how we noticed a 20% drop in our grocery spending as we switched to more plant-based foods and alternatives over the meat, milk, and eggs.
You don’t need to completely give up animal products. Small changes like deciding on having a Meatless Monday dinner or plant-based dinners 3 nights a week can make a considerable saving when you add up expenses at the end of the month.
- Meal plan
Plan your weekly meals, use batch cooking methods, and cook more at home. The more you eat at home the more you save. When I am meal planning on a budget I focus on recipes that use cheap ingredients that can be used in a variety of ways. Beans, rice, lentils, potatoes make the bulk of our grocery shopping. Experiment with different types of beans and lentils to add variety to your meals. You don’t need to buy organic produce. Buy name brand items at the grocery store instead of specialist brands.
It doesn’t have to be boring to eat at home. Plan fun nights like Pizza Night or Pasta Night. Eat out once a week or twice a month instead of spontaneous take out dinners.
Meal planning requires a little effort but the benefits are immense and you will enjoy the process once you get started.
- Resell, Resell, Resell
Resell whatever you can. It can be clothes, books, toys, anything really. You will be surprised at what you can sell when you start looking around your house. I had once made Rs 5000 on clothes I no longer used. You will find such reselling groups on Facebook. Especially in mommy groups on Facebook, mothers are always looking for good quality children’s books and toys. Use whatever your child has grown out of and make some money back. I use such earned back money and birthday gift money to buy the next set of toys or clothes for our son instead of taking money out of our monthly budget.
- Downsize your life
If money is really tight consider moving to a cheaper location in your city or a smaller rental. If moving out is not an option consider these points:
- Negotiate your rent.
- Negotiate your car parking fees/or find a new cheaper parking spot.
- Negotiate the EMI on the home.
Or if you have an extra room in your house rent it out.
- Buy second hand
Whenever you can, buy second-hand instead of first-hand products. Over the years living on one income has seen us using hand-me-down gadgets like laptops, computers, and kitchenware and buying second-hand books, toys, kitchen appliances, sofas, crib, car seats. Basically, get into a mindset to look for cheaper and money-saving alternatives before you buy. There is always someone looking to get rid of a perfectly good phone or laptop as they upgrade. Ask around your family and friends before buying brand new. Not only do you save money, buying second hand and using preloved things is good for the environment too.
- Cut back on Entertainment
When you live on one income you have to come up with innovative and cheap ideas for entertainment. Instead of fancy restaurants, shopping trips, concerts, and paid events consider low cost or free of cost entertainment options like local attractions that are free of cost or low entry fee options, like public art galleries, museums (depends on your location). Parks and beaches are low-cost family day affairs. Carry your own picnic food for such trips outside the home.
Growing up our middle class parents never made a big deal out of eating out or made every trip outside the house about ice-creams and special junk food eating. Our parents and grandparents mostly carried food for the kids on a trip outside the house. Even when we did eat out it was limited to cheap and easily found local food stalls selling foods like coconuts, roasted peanuts, groundnuts, and fruit plates. These were fresh foods available to us as a snack when outside the house that didn’t cost much. I carry the same family philosophy ahead as we raise our son. We go out for the fun of the outdoors, to explore, and spend time as a family. We buy from local vendors and look for fresh wholesome options.
That does not mean we don’t enjoy the occasional ice cream, burgers, or pizza. We just don’t make that the central focus of going out and enjoying. There is always fun to be had without adding expensive add-ons. The other aspect is of course the health benefit. Our children also learn to appreciate local fresh foods over pizzas and ice creams. There is so much to be shared about your city through the local food culture.
- Grab coupon codes
We jumped onto the coupon code trend a tad bit late for our generation. But the savings, using coupon codes are amazing and definitely worth the effort of maintaining a list of places you can dine out or avail free/discounted services. Whenever you find a good coupon be it in the newspapers, magazines or websites make note of it on your phone, and save it for when you would want to use them in the future. For restaurants and dine out options the Zomato app is useful.
- Contentment in owning less
Now I know this is a very personal topic and depends on an individual’s goals in life. Even I have found myself constantly assessing how much I really need? But ultimately making living on one income successful depends a lot on how content you are in owning less. One needs to really ask oneself every time a purchase is considered, do I need this? In my personal experience, I found that the longer we lived on one income the happier and content I felt in our lifestyle. The thing here is that when we are spending mindlessly we rarely stop to appreciate what life has truly given us. But when you are compelled to assess every purchase you start to enjoy the things you own and feel more satisfied with the things you own. You want less and enjoy more. This point is something you need to consider as you make your decision to live on one income as a lifestyle choice.
Hope I leave you with some ideas and inspiration to start living frugally and save for the future
Do leave me a comment with your frugal living tips and how you manage living on one income. I am sure these ideas will be useful to my readers. If you are just starting out and want to ask me questions, feel free to comment below. I am happy to help in any way I can.