The following contributed article has four really good tips that we have all heard before but that are so true. One of my goals this year is to stop using credit cards and to pay for things with cash. We have stopped eating out as much and are looking for free and inexpensive (but fun) activities to do this summer while we save up money for future better vacations. Anyway, when this article came in, it really hit home for me, so I hope it does for others, too.
Being a family that is living off one income can be tricky, but it is possible to do it and to thrive as you do so, rather than just survive. The key is to get serious about your finances and keep track of them, which may seem tedious. But it can help you to stay on top of things and to not feel like each month is such a struggle. There are plenty of families that out there, living off one income, whether as a single parent family or a family where only one parent works. So here are some of the tips and strategies to help your family do just that.
Plan a Precise Budget
When it comes to money and making sure that you have enough to go around, you need to have a budget that is specific and precise. It is no use just looking at your income and guessing what the bills are that you owe. Check your statements and bills, so that you know exactly what you do owe each month. From there, you can set a specific budget for groceries, clothing, entertainment, etc. When you’re specific and precise, you know exactly what money is going where, and what you should be left with at the end of each month.
It pays to shop around in all aspects of your life. Take your mortgage (or rent) as an example. No doubt this will have been set up a while back, and not looked at since. But you can change your mortgage provider, even when you are still owing. The debt gets “transferred” to the new provider. So shop around to check that you’re getting the best deal possible. Are there mortgage brokers that perhaps offer cash back or guaranteed low rates? Shopping around works for other things too: from your cell phone provider, to your grocery store, to where you buy school shoes. Shop around, don’t just take someone’s first offer, and you will save.
One of the best things that you can do to really thrive as a single-income family, is to reduce the amount of debt that you owe. You can never truly thrive as a single income family if you have debt around your neck. So as part of your precise budget, make sure that you look at paying off credit cards or other loans as a priority. It may mean some sacrifices to start with, but it will be so much better all around when you are consumer debt-free.
Using credit cards can be tricky for a number of reasons. One of which is that you don’t “see” the money going, so you can kind of get out of hand as you spend it. And for things like groceries, you just buy what you want and put it on a card. But using cash, and not having cards with you, makes you pay more attention to your budget. If you’re in the store, you can only buy what the cash in your hand will cover. So there is no overspending unnecessarily, and you’re more conscious of what you’re spending.