Married Adults.com Bin Laden Memo To Be or Not to Be, or: How I Learned to Stop Worrying and Love the Barium Enema Grodery Money To Be or Not to Be, or: How I Learned to Stop Worrying and Love the Barium Enema Kids and Married Adults.com To Be or Not to Be, or: How I Learned to Stop Worrying and Love the Barium Enema MoviesWithoutNudity.com Movies Without Nudity.com Cool Stuff at MarriedAdults.com To Be or Not to Be, or: How I Learned to Stop Worrying and Love the Barium Enema

A Website for Adults ...Married Adults that is

Brought to you by Jim Lewis

 

About Us
Legal

Feedback

Index

Grocery Money

Career Information for the Not-So-Career Minded

Uncomfortable in business attire? Snoring through planning meetings? Wishing you were at home with your family? Well, do something about it!

Most families can survive, even thrive, on one income. For most of us, especially those of us on the web, income is not the problem. The problem is expenses. We complain that money never goes far enough, but the reality is that we consume too much. It's time to lighten the load, to trim away the fat.

If you can answer yes to any of the following questions, you can definitely trim some fat. And before you get carried away here—none of this is about right and wrong. It's just MHO (my humble opinion), so take what you like and ignore the rest.

  1. Do you have more than one TV or DVR? I don't know about you, but I spend too much time watching TV anyhow. Cut down on the amount of time you spend watching the boob-tube by just having one in your family room. Try limiting your TV to 30 minutes per day. The first year that I was married, we didn't even have a TV. It is possible.
  2. Do you carry a balance on your credit cards? You're purchasing items without money in the bank to pay for them. Stop it. There's an old proverb that says, "The borrower is the servant to the lender" (Proverbs 22:7). That's because with debt, you earn wages to put into a purse with holes (Hagagi 1:6). The money you earn isn't yours—it's your creditors'.
  3. Do you rent space in a storage building, but you are not between homes? This is the epitome of excess. Have a garage sale and save the monthly storage fee.
  4. Is the term on your car loan 5+ years? You are probably buying too much car. Pay off the car you have and save for the next one so that you can pay cash.
  5. Do you get a new car every 3 years? You can easily keep today's cars six or more years. That will give you time to pay off the current car and save up for the next one.
  6. If I were to ask you how much your car costs, would you tell me your payment amount? When you purchase a car, you need to know whether or not you are getting the best purchase price, not the best payment. What's a better price: a) $480 per month or b) $500 per month? The answer is b). $500 per month for 48 months will cost you $24,000. $480 per month for 54 months will cost you about $26,000. That is $2,000 dollars saved by paying an extra $20 per month!
  7. Do you lease? Leasing is just a loan where you don't get to keep what you are buying. Don't be fooled by the hype. The reason dealers like leasing so much is that it maximizes the interest rate and minimizes the carrying or resale value. When your lease is up, purchase a car with a 3-4 year loan, pay off the loan, and then save for the next car.
  8. Do you operate without a spending plan? Spending plan sounds so much more fun than budget. Read The Complete Financial Guide for Young Couples by Larry Burkett and get yourself a spending plan. It will revolutionize the way you spend money.
  9. Do you plan to fill your new house with new furniture on your new credit card? Resist the temptation. I haven't met a couple with a new house, two cars, and a credit card full of furniture that was happy when the baby arrived. When Amy and I joined our first Sunday School class after getting married, we were amazed at the number of prayer requests from couples where the soon-to-be mom wanted to quit her job to raise her child, but they didn't think they could afford it.
  10. Did you purchase your house based upon both of your incomes? This makes an incredible assumption about the future: that you will always have and/or want two incomes. You are reading an article about how to survive on one income. My suggestion: Downsize. It takes humility, but you'll never get to one-income living on a two- income house.
  11. Are you waiting till you make more money before you start giving to your church or local charity? If anyone tries to tell you that you have to give more to make more, they are lying. God loves a cheerful giver, not one who gives in order to receive. Here's the deal: if you want to be a good steward of the money God gives you, make cheerful giving part of your spending plan. Start with what you can afford today. As you get raises or bonuses, share the wealth.
  12. Is your mortgage payment more than 27% of your net take-home pay (take home minus giving)? You've still got utilities, insurance, maintenance, and incidentals that should eat up another 10-11%. That's a total of 37-38% on housing expenses. If you are spending more, then your spending plan probably doesn't include categories for clothing (5%), cars and repairs (15%), groceries (12%), savings (5%), debt repayment (5%), medical expenses (5%), life and disability insurance (5%), entertainment (5%), and miscellaneous (5%). Why do you need 5% for miscellaneous? You won't need it if you plan to go without haircuts, makeup, postage, gifts, magazine subscriptions, etc. For more help with a spending plan, please read The Complete Financial Guide for Young Couples by Larry Burkett. He also has versions for singles and college students.

What is the problem with debt? It makes assumptions about your future income. What will happen if you are without work for four months? All it takes is one pink slip or an auto accident requiring knee surgery.

Why do I need to save now—I am nowhere near retirement? Grace Caroline, our first baby, died the day she was born. Even a simple funeral costs $2,000.

What is the problem with not having insurance? It makes assumptions about future wellness. Our second baby spent 12 weeks in the neo-natal intensive care unit. It cost the insurance company about $250,000. That would have devastated our family if we did not have insurance. Nobody likes how much insurance costs until disaster strikes.

If you are going to make it on one income, you have to have a plan, namely a spending plan or budget. Try tracking your expenses for two months. Just keep a log of everything you pay for and then divide them up by the categories in question 12.

Do your expenses exceed your net take-home pay? If they do, you are spending too much. You are probably financing it at 18% on your credit card.

How do your percentages line up with those outlined in question 12. If they are way out of whack or if entire categories are missing, you'll have trouble. Are you saving too much? That sounds great until you realize that it is the reason you never feel like you have enough for clothing and groceries. Hoarding or stinginess is not much better a life than being consumed by debt.

Finally, how do your expenses compare to the one income on which you want to live? The only way to make it on one income is to develop a spending plan based upon your income and adjust your expenses.

Before Amy and I got married, I was in the debt spiral. I was overextended because of an expensive apartment, an expensive Acura, and an expensive lifestyle. We were engaged almost one year, so I made a concentrated effort to get out of debt. The first step was a smaller, less expensive apartment. The final debt payment was made four months after we got married. We stayed in the small apartment for two more years and developed a spending plan. Amy knew she didn't want to work once children arrived, so she went ahead and quit working when we got married. Because of our spending plan, we were able to support two people on the same income that I had when I was single and in debt.

After we got married, I started driving Amy's three-tone Buick Century (blue, rust, and metal), and she started driving the Acura. Eventually, it was time to get another car. We knew that we wanted a mini-van for Amy after the kids arrived, so we bought a Honda Civic to save money. Then we saved and got her a mini-van. We continued saving for cars before buying them, and now I drive a two-year old used Mercedes. That's three "new" cars without any debt.

What about the house? We stayed in the apartment for two years, all the while saving for a down payment. We decided how much house we could afford based upon 38% of our net take-home pay and a 15-year mortgage. That meant a smaller home than most people in our income bracket, but it also means that we don't sweat our mortgage payment. Each year we increase our monthly payment, adding an extra monthly principal payment. Lord willing, we will have our house paid off in eight years. Then we plan to use the selling price for the down payment on our next house. We can continue the same size mortgage payment that we are making at the end of the eight-year period and purchase a much larger house. Hopefully, we'll have our dream home paid for within 16 years.

Larry Burkett is the chairman of Crown Financial Ministries. Many of the concepts I have written about here are based upon principles I learned from books by him. I feel safe recommending Larry Burkett because our family has found that his principles don't just sound good; they actually work. The Crown website offers books, tapes, software and other resources about:

  • investing
  • budgeting
  • home buying or selling
  • auto leasing, buying, selling, and repairs
  • careers
  • renting your first apartment
  • preparing for college
  • getting your first credit card
  • debt-free living

Changing from two incomes to one is not easy, but it can be done. Start now. The longer you wait, the harder it gets.

James G. Lewis

Copyright © 2000 - 2017 James G. Lewis All rights reserved.