Painlessly Transition to One Income

Guest post from Julie of Happy, Frugal Mama:

Have you ever thought about quitting your job to stay home with your children? Or maybe you dream about working from home but don’t think you can afford to live in the time it takes to build up that business?

Whether it’s to stay home with children or focus on other ventures, many families have a desire to life off one income. However, it can seem next to impossible.

Everything seems so expensive — from a gallon of milk to entertainment. We’ve all gotten used to a certain lifestyle that often needs to be supported by two incomes. How can you make it work on one income? It’s not as hard as it seems!

Here are the steps you need to take to painlessly transition to one income.

Start Slow

The whole point is to make this as painless as possible. To do that, you need to start slow.

Start by figuring out how much of your income is spent in order to make that income. Look at things like child care expenses, commuting costs, buying a morning coffee, etc.

From there, look at other things that aren’t directly related but still connected. Things like buying convenience foods to save time, or satellite radio subscriptions for your commute. Figure out the cost of all these things and subtract them from your take-home pay.

If there’s anything left, decide on an amount you will now directly in savings and no longer use it to live. Continue to use your pay for the things are connected to work and the amount you are not putting in savings.

Bonus: you’re building up your savings account which can bring peace of mind when you live on one income.

Cut Back

Once you’ve gone about a month or two with the first step, start cutting back on as many expenses as you can.

Do you really need satellite radio? Can you buy fewer convenience items? What about the TV package? Do you need one that big or can you get by with a smaller one? Or maybe you can switch to just a streaming service and over the air channels. Leave no bill alone. Check every bill, subscription service, everything. Consider what you can cut out completely and what you might just cut back on. Remember to think long-term. If you will be staying home, there are likely lots of things that you will no longer need.

Also, remember that it’s a sacrifice. You may not like cutting something out. It isn’t fun to go from buying most things to learning how to make a lot of things. But if you really, truly want to be at home or begin a different venture, it will be worth it.

Think beyond bills as well. Think about how you cook and your shopping habits. You likely can change up your shopping habits and save quite a bit of money.

Even think about your fun and entertainment items. There are so many fun things you can do for free or cheap. Maybe you even need to cut back on your kid’s activities. I know people who do one musical type thing and one sports type thing per kid. That’s it. Not a ton of different activities.

Cut Back More

We’re re-visiting the first 2 steps here.

Now that you’ve reduced your monthly bills, you’ll want to start using your income to pay for just the things that are directly job-related. And I do mean directly job-related. These are the things like child care, commuting, and other costs that you will no longer have when you are no longer working. Stop paying for anything that isn’t a direct work expense.

Any paycheck left after work expenses should be put into savings. At this point, you will effectively be living on just the one income. Use this time to make sure one income will work for your family. Sometimes you do need to work but a lot of the time you can do just fine on one income.

Transitioning to one income can be scary — you may feel like it’s impossible.

Going “cold turkey” and just dropping to one income all at once can set you up for failure, both financially and mentally as it is stressful. Instead, follow these steps to painlessly transition to one income. You’ll likely find that is far more possible than you realized!

Julie lives in Maine and is a wife and mom to two girls. She blogs about frugal living and motherhood at Happy, Frugal Mama, where her main goal is to help you love life on a tight budget. She loves coffee, Netflix, essential oils, and a good milkshake.