Living on Less Than $28,000 A Year: How our family of six survives (and even thrives) on an income that is less than half the national median income, and what the government calls “below the poverty line” (less than $29,990 annually) for our family size. [Read other posts in this series here.]
___________________________________________
Join me on Twitter or Facebook for instant updates or subscribe to my FREE e-newsletter to get posts right in your inbox!
__________________________________________
One of the issues that has helped me the most in getting our finances more in order is the realization that my financial problems are not the problem, they are a symptom.
No more excuses
I had to come to this realization the hardway. For the first twelve years of our marriage I did pretty much whatever I wanted to do with our money. If there was $100 in the checking account and I wanted to buy some new clothes, I did. Of course I told myself it was okay because I was purchasing them at a deep discount and I “needed” those clothes.
Surprisingly a few days later when the power bill was due, I didn’t have enough money to pay it. I would feel desperate, try to figure something out and end up paying the bill late or borrowing money from my mother. The crisis would be solved and I would continue in my financial misbehavior.
Finally, after having to return to full-time employment for the third time (even though I felt very strongly that we should home school our children) and seeing the consequences in my children’s lives, I realized that money wasn’t the problem. I was.
At that point I decided to grow up. I decided to sacrifice whatever I had to sacrifice in order to live my true priorities, because moving from crisis to crisis was not really living at all.
I can give you 1000 tips for saving money, but the only thing that will bring lasting improvement in your finances and your life is to change your mindset. You have to decide once and for all that you want things to change, no matter how difficult the change is.
Repeating the Cycle
I have a friend (and no, that is not a photo of her) who has been in financial trouble for years. She and her husband make a substantial amount each year, yet they almost lost their house twice. They are constantly in turmoil with whatever the next “emergency” is.
All of these emergencies could be fixed by taking some time to plan how they want to use their money and then following the plan. As long as they live in denial that everything is okay and they don’t change the way they think, they will never change their financial situation.
As her friend, I can only stand by, watch and pray. If she decides she wants to change I will encourage her, be her cheerleader and rejoice with her victories. In the meantime, no amount of advice I give her is going to make a difference.
Hope
It’s one thing to think about making sacrifices. It sounds so noble and wonderful. It is quite another to actually make the sacrifices. Honestly, there are times when I want to give up. There are times when I wonder if things will work out and if we have made the biggest mistake of our lives.
But there are also times when I feel so content and at peace. I look at my children who are creative, content and self-motivated, purposeful in the way they live and ready to love and serve others. It’s at these times that I realize that all of our sacrifices have been well worth whatever we have had to give up.
It’s not all rosy and I don’t have the perfect life, but I am far closer to it than I was a few years ago.
If you decide that you want to change your financial situation and you want to stick around, I will encourage you, be your cheerleader and rejoice in your victories. If you’re not ready yet, just know that someone is here waiting when you decide to go for it.
I can tell you this: If you are dissatisfied with your life as it is and you choose to change in order to get where you want to be, you will never regret it.
next post: Save on Utilities
Click here to read other posts in this series.
{ 207 comments… read them below or add one }
← Previous Comments
I applaude your willingness to sacrifice for your family, I, too, had to make similar decisions. I was a single Mom,with three kids.My former husband chose not to be involved with his kids, so I had some pretty hard decisions to make. My eldest has Asperberger’s, and my youngest has Central Processing Disorder. I was almost at one school or another 24/7. Luckily, my Province had some progressive family programs, so we made it from A to B with help from a therapist, special schools, and my Family.I worked when I could, yelled and screamed and got Low Income Housing in one of the better social housing projects.My parents and sisters helped out when they could.All in all, things did not turn out so badly. My eldest is in Administration at the Salvation Army, my daughter runs a loading dock for Whole Foods. My middle is trying to still find himself, but is a great Daddy to his son and acquired daughter and nephew.They are all figuring out that my austerity was not just being mean, Sometimes rent won out over a new pair of Mavi’
s( 150 buck jeans). I used everything I could, food banks, wharehouse stores, Costco when a deal was good, second handme downs.Luckily I had some girlfriends in the same boat. We swapped clothes,sometimes ate communally, had cheap parties for birthdays,bought in bulk, shared coffee,gave rides and chipped in for gas, and signed each other up for every deal we could get. Their kids turned out okay, thought the jury is still out on Justin( Sorry Sweetie, Auntie calls ‘em as she sees ‘em).What you are doing is far, far more important than just staying home, you are creating a life template for them, home and people first, then stuff.
Wow. I have 4 daughters and during the last 15 years of marriage have thought about turning our lives upside down. Me and my wife make a great income and spent every penny of it. It wasn’t till the last 2 years when I lost my job and my wife had our fourth that I realized things need to change. We still plugged along and now that our house has been taken from the bank we are seriously looking for the way we can change the things we do. Keep on blogging it is great to read and gives us awsome ideas. Cheers.
I am so sorry to hear about your job loss and financial problems Kevin, but I am so glad that you are finding some encouragement here. Welcome!
WoW, I feel like you are having a conversation with just lil old me!! Nice to know there is someone else out there with the same struggles and morals as you! Keeping up with the jones’ is not worth it!!:-)
THANKS for posting all this! I’m INSPIRED!!!!!!!!
I’m so glad Allyson.
I’m so inspired by your budgeting abilities. I’m a college student and working mother and I’m going to start TODAY on making a plan for my money and sticking to it. No more spontaneous shopping trips!
The spontaneous shopping will kill the budget for sure.
You can do it Chrissy!
I really want to be frugal and save but it doesn’t seem like my husband is on board. My sacrifices only seem to provide funds for his “toys”. I’ve talked to him about it and he says he’ll commit but with no results. Is it even worth it to try?
Yes, it is definitely worth a try. Dave Ramsey says that in most marriages there is a spender (free spirit) and a saver (nerd). He suggests making sure that the free spirit has a say in the budget and has spending money. I am not a financial counselor, but one idea is to set up a separate account with your husband’s consent. You could then transfer an amount (that you both agree on) from each paycheck for his spending into that account. He can spend it however he wants, but once it’s gone, it’s gone.
Another approach is to transfer all of the money necessary for bills, groceries, etc. into the second account and then you and he could split what was left in the primary account. If you can’t come to an agreement that he will abide by, you might want to try marriage counseling or financial counseling. I think Dave Ramsey has local financial counselors that he recommends through his site. Don’t give up!
For so long, i have thought that we were the only ones who had made poor financial choices. Thank you for letting me know that we are not alone and for giving me hope that it doesn’t have to stay this way.
You are very welcome Sue–there is definitely hope!
Thank you so much for sharing. I have spent the last several hours pouring over your blog (found through Pinterest). My husband and I are going through Dave Ramsey’s Financial Peace University at our church and I have been looking for some creative ways to live frugally and encouragement to keep going when the road is rocky. Thank you so much for sharing and being honest with the highs and lows. God bless you!
Thanks so much for letting me know Theresa. Blessings!
That is exactly what I do now. I have a mountain of debt that I “try”" to pay off. Each month I end up charging back a portion of what I have paid off. And you’re right! On unimportant things that I did not “need.” My partner would like to go back to school and this blog will be a piece that helps us get there! Thank you!
I am so glad that you are finding the blog helpful Molly.
I was really feeling emotional while reading your blogs. I really want this and I want us to be able to build a family with confidence that we can survive financially. I kept feeling myself wanting to cry. Thanks so much for the help! It’s time to make some changes!
Oh Molly–I’m so sorry that I made you cry, but I know you can do this. Let me know if you have any questions.
Thank you SO MUCH for sharing Kimberlee!!! You are the answer to my prayers & I cannot get enough of your Living on Less book or your website. We are a young family of 6 and I too am a stay at home mom. It is extremely difficult to survive on one income, but your website has given me the encouragment I need to push through the big financial mess we have gotten ourselves into. It is nice to know that we are not the only ones who have or are going thru the same difficulties. Thanks again for being someone I can relate to, your advise seems to click more inside my head becasue you are a stay at home mother of four
Welcome Kim! I’m so glad you are finding the information helpful, and we mothers of four have to stick together.
Just wondering if you started behind or if you just started breaking even. My husband and I are behind due to medical bills and such. We have several that are in collections and it is just overwhelming. Suggestions on getting out of the hole when you aren’t bringing in enough money each month. We barely make enough to pay for the standard bills (car, electric, phone, gas, food, etc.). Suggestions?
Hi Shannon- That is a very difficult situation. I am not a financial counselor, but if I were in your position, I would cut back on everything possible (eat cheaply by buying what’s on sale, cooking from scratch, eating simply, etc.–you can read my free e-book for more ideas), not spending ANY money that you absolutely don’t have to and trying to increase your income with a second part time job.
Dave Ramsey suggests that if you are already behind on a bill and cannot pay it, you could stop paying for a couple of months to pile up cash in order to offer them a settlement. Always get the settlement in writing first and never give access to your checking account (pay with a cashier’s check). If you have a car payment, you may want to sell your car to get a cheaper one. I am so sorry that you feel overwhelmed, but just try to take one step at a time.
Hello. We are starting your series today. My husband and I just printed out the spread sheet & he is filling in the blanks. We have a couple of questions. What about health ins? And phone bill, you put that under utilities?
I put the phone bill including the cell phone under utilities. I did not put a category for health insurance because that is usually taken out of people’s paycheck, but you can print the blank form and fill it the way you like.
Found this through pinterest, and I have been very encouraged by it! A year ago, I decided to become a stay at home mom, and now there are three of us living on only my husband’s meager income. I always considered us to be just scraping by, until a friend complained about how her utilities were about to be turned off, and they were in danger of losing the house. In the course of the conversation I mentioned our savings account, which we have designated for emergencies. My friend seemed flabbergasted that someone who literally made about 3x less than than her had WAY more money than she did (and way less stress about it too!) It made me realize that wealth isn’t about how much money you make, but what you do with what you have. Living on very little has not always been the easiest, but our quality of life has improved so much since I left my job to stay at home with my daughter! I wouldn’t trade my near-stress-free living for all the money in the world!
So true! Thanks for sharing that story Joni. I think some people just aren’t aware of what they spend and that they could live on much less if they were careful.
I also found your blog through Pinterest, and I’ve been reading through all the posts in this series. Great advice. I’m a single graduate student making just above the poverty line, so even though I don’t have a family money is tight. I have already incorporated lots of your ideas into my daily life, but I especially like this post because it has been one of my biggest struggles. Shopping has become less a necessity and more a hobby to a lot of people, sometimes social (shopping with girl friends!), sometimes therapeutic (shopping “therapy”), sometimes we do it just because we’re bored.
One of my favorite ways to get the psychological satisfaction of shopping without the buyer’s remorse and empty wallet is actually the very same site getting your posts so much traffic: Pinterest. I shop online and pin the pretty things I find to my boards. I even have a “Lottery Winnings” board for super expensive items I can only dream about
It’s a great way to imagine clothes shopping especially.
Great idea Sharon!
Thank you so much for sharing your story Kimberlee & to your readers for showing kindness & sharing their stories & information. We can all learn from one another with sharing. I completely agree & love that you say that your way may not be the way for all people, and I feel that there we can all share & learn from each others experiences and appreciate one another.
In the 90′s when I lost my job I decided to change careers completely and went into banking. I learned so much about finances working at a bank. I took away fo much information from the courses, seminars, books & training that that bank provided me with and for that I am thankful. I was very shocked when I learned that most of the staff working in that organization didn’t take advantage of the information for their own personal lives, but just to ‘sell’ to the customers and earn commission & bonuses. From my experience, most of the people at the bank telling you what to do with your money don’t practice what they preach. Also, the rudest customers were the ones that were mortgaged to the maximum, maxxed out on their lines of credit, dressed in expensive clothes, driving expensive cars and taking it out on me that their debit card or credit card wouldn’t work because they didn’t have any credit left to give.
I think that experience really helped me & prepared myself & my family for us to become a one income family and barely feel the pinch of the income loss.
I have friends & family that ask how we possibly live on one income and I answer them honestly about budgeting, lifestyle changes and my hobbies such as couponing & contesting to save money, I find that I usually get teased. This bothers me greatly. I don’t expect anyone to follow my path, but don’t tease me for mine.
Thank you so much for sharing &K I look forward to learning.
Nicole
I think some people tease because they are made uncomfortable by the truth we are living. It is easier for them to live in the denial that debt is a necessity when they aren’t being confronted by our choice of lifestyle–just a thought.
It does my heart good just to not feel alone in this. We have been traveling and living abroad on and off for 2 years and it has cost us dearly, though that’s really just one excuse for the same kind of financial irresponsibility you describe. We have 2 small children and this coming month, as my husband worked out the budget, is the tightest and I have to face finally making good on intentions to actually spend less. Thanks for all your tips, I hope they help me reign in my spending (on food in particular)!
I am so glad that you don’t feel alone. Hang in there!
Kimberlee-we’ve been following your budget template (tailored to our need obviously but using your basic structure) for about 3 mos. and we’re now starting to really, truly reap the benefits. I saw immediate results right when we started but now after these 3 mos. we truly are seeing some of the longer term benefits like a growing savings account and less stress about surprises such as a $75 co-pay at the emergency room a few weeks ago. We had always done “ok” with the budget but we were always struggling with extraneous spending. Now, while I sometimes complain bitterly that the budget hates fun and shoes, I realize that the reduction in stress is an amazing reward. Truly, it has changed our lives. Thank you.
I am so excited for you Kiki! Thanks so much for taking the time to let me know.
Thank you so much for sharing all of this. I found the link on Pinterest, as did so many others.
We are a homeschooling family of three. My mom has been living with us since June (she lost her job and apartment then). With grocery prices going up, and the added expenses of another adult in the house, I’m coming up short every week. Even though my husband has a side job a couple nights a week to supplement his income as a forester.
I need to be a better steward of the resources I have. You are an inspiration.
Sorry about the sudden changes for your family, but thankfully you can help your mom through this time. I am so glad that you felt encouraged by the blog!
I just found your blog. I am a SAHM, with six kids. We have been living hand to mouth for far too long. I have failed at budgeting and although I make a grocery list and shop what’s on sale, I still find myself running out or something and needing to run in to the grocery store really quick. Augh! I am so excited to follow you, and hope to get lots of encouragement and advice to help us. Thank you for putting yourself out there so that people like me can benefit from your wisdom.
Hi Britanie–welcome! I hope you do find some encouragement here. Let me know if you have any questions.
I was taking some “me time” today after the holidays and found your blog through Pinterest. We are also Dave fans, with me being the “nerd” who married a “free spirit”
Thanks to poor planning on our part coupled with major medical expenses and hubby’s job layoffs, we’re about to lose the house. As terrifying as that is on one hand, part of me is staying calm to plan rationally through the situation, including me taking over majority control of our finances. I am thoroughly enjoying your blog, reading and making planning notes as I go to help me organize and prioritize my steps. I’ve decided to take this horrific situation and turn it into a major learning experience and fresh start. It WILL get better!
I am so sorry that you are losing your house Kimberly. We have been there as well. It is difficult, but you will be okay. We moved to an apartment before our house was foreclosed while we still had decent credit and God was faithful to provide a house to rent a year later. Looking back, I wish we could have avoided it, but it did help us to grow. I hope you have a Happy New Year in spite of the difficulties you are facing.
Wow. I needed this. I’m the money problem in our family and money is always the topic to our arguments. I always thought I was “getting better” but reading your blog has brought me to reality. Thank you. You have a lifetime fan starting now!
Welcome Sarah! Glad I could encourage you.
← Previous Comments