For about two years now, my wife and I have been a one income family. We do that by choice as one of our family’s financial goals is for my wife to stay at home with our son. So far it has been a blast and we do not regret it one bit. With that being said, it is not easy all the time and there are some things that we have had to forego. If you are deciding on becoming a one income family, here are some tips on things to do before making the decision.
Make sure this is something you really want to do
Living on one income and having the other spouse do something else sounds good in theory. But reality can set in very quickly if you are not prepared to make some cuts in your spending. Sit down together with your spouse before you decide to go down to income and have some frank discussions about what you will be giving up and if that is truly what you want to do. There is nothing worse than turning your dream into a nightmare by not making the necessary spending adjustments and continuing to live your lifestyle of two incomes, therefore getting yourself into a financial mess.
Have an Emergency Fund
This is important no matter how many incomes your family has but for one income families it is even more important. For one income families there really is not as much margin in most budgets to replace your savings in case of emergency. Therefore it is paramount that you have a good emergency fund saved to weather any storms that your family faces, especially in the first year.
Test it out first
If you did the first tip and discussed in detail the changes that you will have to make in your lifestyle, than the final step is to test it out. You do this by living on the one income of the spouse who will continue to work for a few months. The other spouse’s income you can either put into savings or pay down any debt, minus any daycare or transportation costs associated with the quitting spouse. Do this for a few months and see how it goes. Who knows, it might be a lot easier than you expected, or it could be difficult in some areas. If you have debt, you might realize that those payments are keeping you from making this a reality. If that is the case, make it a point to get rid of the payments and create more cash flow to make quitting a stronger possibility.
If you are thinking of becoming a one income family, I would encourage you to do it! Yes, you’ll be giving up some things, but what you gain is worth it! However you just can’t have one spouse quit without doing any planning and simply “hope” that things go well. But if this is something your family is thinking about then try these three tips and see where you stand. Living on one income has been great for our family but before you decide if it is right for you or not, make sure you can “afford” it.
For those of you who do live on one income, do you have any other tips on how you do it?