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Living on One Income: How to Make it Work


Even in the best of financial times, living on one income is a challenge. From necessities like food, shelter, clothing, medical bills, transportation, and taxes to "wants" like entertainment and leisure, the drains on a family's financial resources are many. 
This is especially true in this American society built upon conspicuous consumption. Living frugally can seem impossible and unfair, especially when it seems that so many other people live wasteful lives. How does a family manage not only to survive, but to prosper with only one income?



What it Takes
Families can flourish, even on a limited single-income budget. But doing so requires a rejection of current financial and commercial values in favor of more "old fashioned values." Families need to stop trying to "keep up with the Jones" and instead determine what is truly valuable in their lives. Learning to distinguish between true "needs" and "wants" is key, not only to financial health but also to ultimate happiness and satisfaction.
Find Big Savings
Focusing on the big-ticket items that take the most out of a family budget is vital to surviving with one income. You must give up the car payment, one way or another, even if that means selling your car while still owing on it. If you wait until your car loan is paid, the car you are paying will have depreciated so much in value, you will have lost more in the end. Sell it now.
Replace Your Over-priced Car
How will you get another car and continue paying on the loan? A little creativity may be needed. If you have two cars, you’ll need to get by on one. Sell the most valuable car and use the money to pay off the other. If you only have the one car, sell it now, and take physical damage insurance (collision, comprehensive, rental) off the car. Withhold $1,000 - $2,000 of the car’s value and keep it in an online savings account with high savings interest, in case you need to pay for damages on your car or repairs. Use the money you save on insurance every month to pay down what remains on the car loan.
Find a car in the $1,000 to $2,000 range in good working order. You may spend a little time searching before you find the right one, but it is essential you do this. Stop wasting money on a car and you will have eliminated one of the most costly budget items. 
Save on Food
Food is another expense that families can cut back on. One-income families have a money-saving advantage that two-income families don’t: time. The family member who stays home and cares for the house and kids should be the one using that time to plan shopping. Restrict eating out to dollar-menu items only. Make coffee at home. Clip coupons and use them in conjunction with sales at pharmacies, grocery and discount stores, stocking up on regularly used items at the lowest prices. Follow couponing blogs to hone your money-saving skills. If you have only one car, you may need to shop on the weekend when the working spouse is home. 
Keeping growing children in clothing is tough when you do it at retail stores. Give up retail altogether in this department. You can find everything you need at thrift stores cheaply. 
Many stores have sale days when you can get items half off. Use these days to your advantage. Those two-income households are discarding top-name brand clothing that you can buy up for just a few dollars, keeping your family well-dressed at about 10 percent of retail cost.
With some sacrifice it is also possible to save money on utilities. Using less water and electricity can save many dollars a month. Reducing or eliminating cable TV is also a good money saver, as many TV shows can be found free online. 
Cell phones are often a big money drain as well. Don’t pay for a cell phone and house phone. Pick one. Wi-fi phones are a cheap option where you can make phone calls over any wireless internet connection. You can pay $20 - $60 a month for high-speed access and replace your cable and phone in one fell swoop.
Make it Your Mission
Continue looking for ways to save every penny. Put 20% of your take home pay in the bank, invest 10% for retirement, and you will have emergency funds when you need them. When you take that 20% out before you even see it, you find a way to get by on the rest. 
Don’t get caught off guard from an emergency because you failed to save for a rainy day. It will undo all your best efforts at getting by with just one income.




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