Thanks to Kylie Ofiu for publishing, 5 Dec 2013
A common strategy used by expecting couples before having a family, is to live on one income. However, why should this be exclusive to expecting couples only? How much could you save by living off one income, and putting the other income towards your home, a deposit for a home, a business venture etc?
My husband and I did this exercise for twelve months prior to having children and managed to save enough money for me to be a stay-at-home mum for one year after having my first child. I was not entitled to maternity leave at that stage, so we needed to save as much money as possible.
We managed to put aside nearly my entire income
for the year. It was a fantastic exercise!
It was also a very good introduction to the frugal life we were going to lead in the first couple of years of having babies, because once my eldest turned 1, I then fell pregnant with number 2. So now five years later, I’m still at home, however I have picked up some part-time work to make our lives a little more comfortable.
With today’s interest rates being so low, why not consider living from one income? Imagine putting aside $60,000 (average annual income for females – May 2013*) in one year!? And where did the last year go … time flies so quickly it will flash before your eyes.
Review your existing budget, or put together a list of all your expenses, and work out how you could afford to pay your ‘essentials’ from one income. Anything ‘non essential’ will either be forfeited, put off for one year, or paid out of extra earnings (i.e. part time work, selling exess furniture/toys/clothes you have at home, newsletter drops, walking dogs for a fee etc). If your existing commitments won’t allow you to live from one income, perhaps consider doing half your income instead.
I’m not going to mislead you, this will be a tough exercise and not for the feint hearted. However, look at those benefits! How soon could you pay off your home loan if you did this exercise for 1 year, 3 years, 5 years!? Once you get used to a certain style of living, you might find that you didn’t need those extra extravagances after all?
Are you up to the challenge!?
*Reference: Australian Bureau of Statistics
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