One of the hardest things to do when you get married is to try and live off on a single income budget. As you get into a union, you combine everything you have from your income down to your expenses. You take on life as a couple and discuss ways to make it better. As challenging times try to test your union, you take them on side by side.
One of these tough times that you have to weather out as a married couple has to do with your finances. From the time you are trying to plan your wedding to buying a car, a house or even paying down student loans, you do it together. Your household budget has to always consider factors from the two of you. This is one way to prevent finances from destroying your marriage. But what if you have to scale down from a double to a single income household?
To put that in perspective, it would be good to know that BLS.gov shared that in 2015, average expenditures for households was at $55,978. This means that an average family would need that amount every year to make ends meet. From food to shelter to clothing and other basic needs, it totals to that amount. With that in mind, why would married couples decide on a single income for their household?
There are a lot of factors that comes into play when a family decides to downgrade their income. There are some couples who are forced into it because of medical emergencies or even job loss. For some, they want to take on a minimalist approach to life or have one of the parents take care of the children. Then there are some couples where one wishes to pursue a passion, a hobby or a business idea and have to give up a steady-paying job.
In most of these cases, diving into a single income household is doable with some lead time. Here are a few things you need to consider when you decided to take the jump and live with one income.
Pay down as much debt as possible
Debt would be the first stumbling block to your goal of living on a single income. There is a big chance that even before you got married, you already had debt payments in your budget. It can come from credit cards to student loans. Now that you are married, you would have the same plus some more big ones. Mortgage loans, car loans, as well as basic necessities and utilities.
One way to prepare for a single income family is to pay down as much debt as possible. This would take some time but the idea is to lower down debt payments. This is to allow that one income to go to basic needs and saving for the future. There are payment tips you can look into but one idea is to consolidate debts. With a better credit score, the payments would come out lower. It is also easier to manage with just a single payment amount every month.
Budget based on a single income
Even before you actually live off a single income in your household, it might be a good idea to try it out for a few months. As a couple, you need to sit down and tweak your household budget to be able to cover all your financial needs with just one income. From there, you would have a pretty good idea on how it would turn out.
This is an important process because it gives you first-hand experience on how your finances would turn out. Much like how you would test-drive a car before buying one, you need to test out how living off on one income would be. Will everything fit inside the budget? What would be the stress points in your finances and your relationship? These are just some of the questions you get to answer when you try it out.
Know that there will be sacrifices with single income
As you take on a single income household, you need to keep your sights on your goal. You need to remember why you are doing it because there will be sacrifices that will test you out. If you are doing it to take care of the children, you need to remember that when you get exhausted with them. If you are pursuing a hobby, you need to keep that in mind as you work with a limited budget.
Sacrifices will be part of the process but it does not mean that you have to give up all the luxuries you were used to. You just need to find a way to lessen your expenses. If you love being with friends on a Friday night then invite them over for potluck dinner. It is less expensive than dining in a restaurant. You get to enjoy time with friends but you do not spend so much for it.
Have an open line of communication
One of the most useful tools you will have in your arsenal as having an open line of communication with your spouse. Familylife.com shares how poor communication between couples can lead to marriage difficulties. You need to be able to talk to each other about your finances as situations arise so you can tackle them together.
It would be hard to try and resolve issues alone. It can breed frustration especially if left unresolved. This can lead to disagreements and could escalate to fights. One way to survive on a single income household is to be very open with your partner. If there are unexpected expenses that are coming up, you need to talk to each other about it. If there is extra money coming in, you both need to decide how best to use it.
Figure out a side hustle
The whole idea of living on one income is because one of you has to stay home. This is why your budget has to rely on one steady income. However, this does not mean that you cannot get any side jobs to augment your budget. Whoever is left at home can explore ways to earn a little extra money on the side to help increase the family income.
It can be baking cookies and selling them to neighbors, family and even friends. Online jobs can also be explored. If you take this on, you can choose to do it on your own free time. It is possible to put in a few hours after the children are asleep. Weekends can also be a time to put in some work when your working spouse is at home.
Passive income is also another area to consider but this has to be done prior to living on one income. The way it works is to use whatever interest earnings you get from an investment and use that to add to your budget. It just has to be done early on so you can put in a sizeable amount to be able to earn enough interest.
Living on a single income is challenging but not at all impossible to pull off. It just needs a lot of work, dedication, and sacrifice to make it work.