Many modern families can’t survive on one-income because of the poor economy. However, this poor economy has also inspired out of work adults to go back to school, focus on their families, or take up a different career path. Despite the fact that doing these things often requires big sacrifices from both spouses, it can be easier than you think.
Get on the Same Page With Your Partner
Don’t just decide out of the blue that you are going to quit your job and go back to school. Make sure you talk it over with your partner first!
People are very touchy about money matters and many couples get into fights because of money. Make sure you draw out a written (or verbal) contract and make sure you understand exactly how money matters are organized.
Carefully Map Out Your Budget
You need to determine what you need and what you can give up. Basics like rent and groceries are obvious. Other things like dining out, clothing allowances, entertainment, and fixed expenses such as cable, cell phone payments and monthly subscriptions are sometimes forgotten. Think it over.
Trim Big-Ticket Items First
They always say the key to saving money is in the little things like your daily lattes. Not exactly true. Trimming costs on housing, cars and other major monthly expenses will free up the most room in your budget. Explore nontraditional living arrangements, such as renting out a room, or sell a car if only one person is going to commuting.
Say ‘So Long’ to the Joneses
Let your friends know that you won’t be able to participate in any fancier get-togethers and try to arrange things that are cheaper–like a potluck. Your friends should stick by you no matter what your economic status is and if they leave you hanging after they find out you can’t pony up for a bottle of champagne then they weren’t good friends at all.
Don’t Cut Back Too Much
Make sure you are still putting plenty of money where it counts–like retirement savings. Our if you need to dine out to network, make sure you work that into the budget. Be honest with your needs. It’s okay to want a fancy drink or lobster ravioli every once in awhile.
Recast Your Savings Strategy
Keeping two incomes but relying only on one for living expenses can open up a world of savings opportunities for things such as starting a business, planning for retirement or building a cash reserve in case of a layoff, experts say.
Give it a Trial Run
Practice makes perfect. See if you can live like a single-income family before you actually do it to see if it works.
[Source: Yahoo! Finance]