How to Make a Household Budget for One Income Family

Updated

Are you a one-income family that is trying to budget? I’m here to say that it can be hard. Throughout life, couples may go through job changes, which results in one income. Other times, you may decide as a couple that you want to live on one income and support your family that way. If I’m being honest with you about one thing, it is how household budgets can make your life stressful. Financial management is not easy in the slightest way. However, it is possible to create a functional household budget for a one-income family. Here’s how to get a functional household budget for a One income family:

Functional Household Budget for a One Income Family

#1. Get rid of the extras

I’m not saying get rid of ALL of the financial expenses, but it may be hard to live on one income and expect to continue with the extras. Some “extras” may be a cable or even an extracurricular activity that the kids are in. By getting rid of the extra expenses, you are making it realistic to be able to pay your bills without stressing about everything else.

Look how fast the extra expenses can add up:

  • Cable with all the extras: $100+ per month
  • After School Sports: $200 a month
  • Eating out twice per week: $150 a week!

#2. Get on the same page as your spouse

Just so you know, it’s hard to do a financial budget when you and your spouse aren’t on the same page. One spouse may be out spending money and you’re trying to save it. Keep in mind that communication is super important when it comes to budgeting for a one-income family. If you’re not on the same page as your spouse, things could get a little weird.

#3. Keep the budget realistic

When families are working on their budget, they don’t always keep it real. For example, the family may need $100 for clothing a month, but they only budget $50 a month. It’s better to go over on your budget than to go under. Going over on a budget is quite common when you’re first starting out. You may not plan enough for groceries in a month, so you’re hurting a little bit when it comes down to it. Over time, you’ll get better at your creating your budget and telling your money where to go.

#4. Keep your expenses low

Easier said than done, right? When it comes to creating a functional household budget for a one-income family, you need to keep your expenses low. Expenses might be the amount of money you spend on groceries or the amount of gas you use. It’s extremely important to make sure you try and keep your expenses low when budgeting on that one income. Keeping your expenses low is something that must be evaluated quite often. For example, you may find that the groceries you’re buying in a month can be purchased somewhere else a lot cheaper. When you keep your expenses low, you’re able to have more of a cash flow every single month. Makes sense doesn’t it? That way you’ll also be debt free. I’d rather have money left over then spend money to pay for things I do not need.

#5. Track your family’s expenses

Now when it comes down to trying to live on one income, tracking expenses is extremely important. This can be SO hard! It is hard work to keep track of every single thing you buy, but it’s totally worth it. Track each of your expenses to get a way to communicate with your spouse. You both are held accountable for each thing you spend. Sometimes all it takes is knowing you have to answer to someone else for your expenses.

#6. Live below your income

When most people are buying their first home, they are concentrated on how much home they can afford. However, what if you bought below how much home you can afford. Just because a bank says you can afford a $300,000 home, this doesn’t mean you need to purchase a home worth that amount of money. The same thing goes for everything else in your life. Just because you can buy a new car, it doesn’t mean you need to buy a new car. Just because you can send your child to the most expensive private school in the land, it doesn’t mean you NEED to do that. By living below your income, you are able to live on one income a lot easier.

#7. Plan to Save

Living on one income is only easy if you are able to stay out of debt. The average American family is literally working to just pay off their debt. Something you can do to help your family live on one income is a plan to save. Save up money when you can, so that you have the emergency funds there when you need it. You can stay debt free even during emergencies. Plan to save for a vacation, Christmas, and everything else. While setting up these smaller budgets may be hard, they are totally worth it for you to stay debt free.

#8. Have budget meetings with your spouse

These budget meetings are hard, but they are totally worth it. Getting together, on purpose, to talk about your financial status can sound like a disaster to some marriages. At the end of the day, it’s better for me on the same page with your spouse than to fight about money all of the time. Have those on purpose budget meetings, so your finances start to make more sense.

If you’re living on one income, I encourage you to take a deep breath. It’s stressful! It can be hard to even think about living on one income, but with these tips, you can make it happen. If you are a two-income family right now, I encourage you to start living off of one income now. Save one income and budget the household on the other. If you can do this, you know you’ll eventually be able to live on one income.

What tips do you have for a family who wants to live on one income? Do you have any budget tips that you would add to this list?

One last tip—Enjoy life! When you have a budget (even on one income) it’s a lot easier to enjoy life. You don’t have to stress because you are being responsible with your expenses!

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