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.]
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So far in this series, we’ve covered:
- Finding a money management system that works
- Trusting God with your finances
So far I’ve talked about several practical ways we are able to live on less than $28,000 a year. Today I’d like to talk about something a little less “practical”, but perhaps even more important: our mindset.
I think most people have some vague financial goals in the back of their minds (ex. save for retirement, go to Italy one day, pay for kid’s college, etc.). We did too, although I don’t think we ever talked about them or wrote them down. Without a clear vision, we failed to realize that the small decisions we were making each day either moved us toward those goals or prevented us from reaching them.
We had a disconnect in our brains between what we were doing in the moment and what that action meant for our future.
To be honest, our financial “goals” were really more like “nice financial thoughts.” We never made any real effort to move toward them because they were distant and fuzzy. As Zig Ziglar says,”If you aim at nothing, you’ll hit it every time.” Living in the moment seemed like fun, but we were just floating along without any purpose or direction. We were essentially wasting our resources and our lives.
Then a few years ago, I had an epiphany. I had wanted for some time to be able to stay home with my children rather than living a crazy, disjointed life of full-time work and part-time parenting. I finally realized that if I wanted to actually reach that goal, I had to really live within our means, not just say that I wanted to. I realized that I could keep doing whatever I wanted to do in the moment, or I could make some sacrifices in the short-term in order to achieve what was truly important to me.
Six years down the road, I can definitely say that I am glad that we have made the choices we have made. We don’t do everything perfectly and we still have problems, just like anyone else, but overall we have a good life and much to be thankful for. By making better daily choices, we are able to live our priorities with less money rather than chasing after more and more with the illusion of one day living a “good life”.
So what are YOU aiming for? What are YOUR goals? What do you want to happen in the next month, year, 5 years?
Picture your life in 10 years. When you look back, what will you be glad that you did today? Take some time this week to make a written list or a visual board with pictures and words that represent where you want to go in life. Write down your life goals, then make your financial goals line up with what you truly want. Keep your life vision fresh in your mind by keeping it in front of you (on the wall, bathroom mirror or refrigerator door), then make your daily decisions based on those long-term goals.
I have several resources you can use to get started:
The Peaceful Mom Life Inspiration Board– Print this page and use the Life Inspiration Questions to get started. Write in your vision for each area.
The Peaceful Mom Goal and Action Planner– Print this page to evaluate areas in your life that you want to change (you can find more detailed instructions on the post). Write your action steps on the bottom of the page. You may want to print a separate page specifically for financial goals.
The Peaceful Mom Weekly Goal Planner– Once you determine your long term goals, you can use this Weekly Goal Planner to make sure that you are working toward those goals on a weekly and daily basis.
next post: Drinking Problems
Click here to read other posts in this series.
I’d love to hear some of your goals if you’d like to share them in the comments. 🙂
We can all use some encouragement in this area.
I enjoy reading your tips and find them helpful- thank you. However, I was moved to comment because of your “full-time working, part-time parenting” statement. Although some may choose to work full time, they can still be full time parents, making what they believe to be the best choices for their children. While parents may be gone to work and away from their children for hours in a day, that does not mean that their parenting approach is passive or part time any more than a stay-at-home , home schooling parent is just lazy or rearing unsocialized children. I use the latter as an example only because it is another hurtful and often untrue myth about many that choose to stay home.. Just as is the myth of many working moms being part time parents. God bless.
Hi there! I was speaking specifically about my situation. I was unable to parent effectively while working a full-time job. If you read my other posts, then you will see that I am a huge proponent of families doing what works best for them. Some families have made choices that require them to both work full time, and they are able to make the best out of that situation. I could not, so we made the choice for me to stay home with our children.
I would like to pay off mine and my husbands cc debt, car debt, and student loans. The rest I would put in savings. With all the extra money that would be freed up from cc, car, and student loans I would put towards my mortgage. I really wish I could get an extra $100,000! 😀
I love your blog. My oldest son just started preschool and we had to do a budget to get used to paying his tuition. I work from home so we haven’t had to deal with the costs of daycare/preschool. We can’t quite make it on 28,000 but I really think 35,000 is doable once we get in a good rhythm.
Anyhow we refinanced our house earlier this year and saved $200 a month which we have been sending right back to principle in hopes that our house will be paid off by the time the kids start college. Another little goal is we noticed we haven’t been putting hardly anything into our boys’ college savings accounts so we started just putting $5 a wk into each kids account (we have 2 boys.) It starts adding up pretty fast especially since we put all their bday and christmas money in their accounts too.
If we are able to pay our house off and start them off with a little money if/when they go to college we will be able to help them with tuition not having a mortgage and hopefully they don’t start their adult lives out with debt.
I love that you are putting the money you are saving on the payment back on to the principle–brilliant!
Full time working and part time parenting? I don’t think so. I work full time AND parent my 4 kids full time. The youngest do stay home with dad during the day, but that doesn’t make me any less of a mom.
As a young couple with no children, my boyfriend and I lived mostly within our means but would splurge on expensive presents and eating at resturants frequesntly. I don’t have a car payment, we don’t have a mortgage, things seemed to be comfortable for us. However we weren’t putting much money into savings either. I think that when you’re young (we’re 25) you don’t fully understand the value of an emergency fund. Up until you’re about 18 your parents deal with anything that goes wrong, and so we hadn’t really thought to save for a rainy day, so to speak. Unfortunately, as with some of the other comments, disaster struck. Our basset hound suddenly became very ill and we had a very hard time coming up with money for vet bills. We were unable to get emergency credit but did borrow some small amount of money from my mother and i started frantically trying to sell my few things of value on ebay and CL. Since we only had a set amount we could spend we tried to discuss with the vet what was the best treatment we could get with our limited budget. We took him home after treatments instead of leaving him at the pet hospital, the vet gave us perscriptions that we could get for free from our Publix pharmacy. After weeks of staying up with him at night, giving him medicine around the clock, crying and praying, he wasnt able to pull through. We were/are both utterly devastated. People who are close to their pets will understand. Even though we tried our best to give him the medical care he needed, i will forever regret that we didn’t have more money to spend on him. Rationally I know that there was a good chance he still wouldnt have made it even if we spent thousands of dollars on him, but emotionaly i still have a horrible feeling of guilt. This has driven me to take control of our finances.
My goal is never to be unprepared again. It really opened my eyes to the fact that making the bills each month is NOT financial security. Now I look at everything we spend. We still spend alot, we have nice things, we eat out, BUT we always we make sure we are putting into savings first. It’s a hard lesson, but with God’s grace i am still learning.
I am so sorry about your dog Bri. It is devastating to lose a pet, but especially if you feel you could have done something differently. I am proud of you, though, for changing your life so something like that doesn’t happen again. Way to go!
First, I want to say I’m loving your blog! I recently just graduated from college (six months ago) and a few months ago I started my first full time job. My goal is to pay off my student loan debt. Thankfully, my boyfriend’s family paid for this school, but he has some credit card debt he would like to pay off. We will definitely be utlizing these tips and exercises to figure out our priorities and make some changes in our spending. Thanks for sharing, all of these posts have been very useful and inspiring.
I am so glad Mary. Thanks for letting me know. 🙂
The goals thing is hard for me and my husband. My goal was always to stay at home with my children and that is what I am doing. I have other goals but they have always come second. My husband has many, many other goals and they seem in direct competition with me staying home. I used to think he wanted me at home too and we were in agreement but that doesn’t seem to be the case anymore. As he gets older (and he is 8 years older than me) I think he gets scared that we will never achieve his goals on one income. It has caused a lot of turmoil for our family. I’ve tried to make extra money and have something lined up now which will help a little but he wants me back to work full time regardless of how little it will actually profit and what it will do to our family. It’s so stressful having different priorities and mindsets on what we are willing to sacrifice. I am so happy to find your series! It helped to renew my desire to be frugal and keep the big picture in mind!
I am so sorry that you and your husband aren’t on the same page Jessica. I pray that you can stay home with your children since that is your desire, and that you can work through things together with your husband.
We have a long term goal to purchace a cabin at our favorite lake! We can do it as soon as we pay off the house…which is many years away but we can do it!
Also every month when I go over the budget I make 2-3 monthly goals. i.e. get new windsheild for car, put x amount of money into x-mas fund or pay off medical bill. That way every time I go over the budget I have a reminder to some things we need to get done or help acheive larger goals. If i don’t manage to get to one of the goals i just bump it to the next month.
With summer coming up do you have any suggestions for stay at home moms to have a successful (meaning entertained and happy) summer without breaking the bank?
Here are some of my kid friendly posts: https://thepeacefulmom.com/family/ (scroll down for the Summer Sanity Posts). I also made a Summer Activity List here: https://thepeacefulmom.com/2011/05/27/summer-sanity-the-ultimate-summer-activity-list/
Kimberlee,
Thank you so much for your blog. I love reading it. It definitely gives me food for thought on how I want to change on how we spend and save our money, and also how I think about making goals.
Thanks again.
You are very welcome Deb!
I would love for my husband and I to be able to purchase a home one day instead of just renting forever… it seems near impossible sometimes
We are saving for 3 big things in the next 4-5 years. They are to fund our oldest daughters portion of private college tuition not covered by scholarships (about 5,000/yr), a new to us vehicle, and the purchase of 20-25 acres of land in a different part of our state. We recently met a goal of saving for a new to daughter car for going to college. There were obstacles that got in the way and we don’t always save as much as we should because we had a bad spending week, but we got enough to get her a nice vehicle with cash. After a very large amount of consumer debt, this is a great step in our goals and a great learning experience. Had we not monitored our spending and owned up to a bad week here or there, we would not have made the goal.
That’s awesome Dianna!
Well, our priorities have changed. Actually, my mindset has. We were saving, sporadically, towards having a child. Just one because we know that’s what we can afford. Now, I’ve finally accepted that a very optimistic 5% chance of getting pregnant is not very high odds. We’ll try for one more year, but then we’re going to begin looking adoption. Which may have been God’s plan for us all along.
A happier, more current goal is some “minor” kitchen repair…paint, countertops, floor.
I’m so sorry Leah. That has to be so difficult. We have several friends who have adopted and it has been such a blessing, but I am sure that you are grieving. Praying for God’s comfort for you.
Leah – my husband and I have tried for some time as well to have a biological child. After more than a year of surgeries and bad news from multiple doctors and the best infertility specialist in the region, we prayerfully investigated and applied for an adoption. In less than 2 months, we have been matched with a birth mom and are less than 10 weeks away from getting our baby girl! It’s been a tough road but God has provided for us the entire way. Our marriage is stronger because of this battle. Don’t give up hope. Your kids, whether biological or not, will come and so will the necessary provisions to receive them. Who knows – maybe about the time you finish your home repairs, your sweet baby will come along. 🙂
I can so relate to the previous comment about disaster hitting. We were hit twice with major illness and medical bills. The costs after insurance were astronomical. It took $30,000 savings, part of our retirement money and 4 years of back breaking sacrifice to pay all those we owed. We have virtually no savings now and a tiny retirement. One never knows what will happen.
our eldest is almost 5 so our major goal is to fund a private education for all 3. we’ve got smaller goals too: house improvements, new(er) car, etc.
Our situation is a little strange because my hubby and I met many financial goals and then were severely tested. We have ALWAYS been frugal. We bought our own homes during several work related moves, lived frugally on one income, put four children through excellent universities, had retirement savings, gave generously etc. Then we hit the perfect storm of severe illness and job loss and we lost everything. We were literally homeless. We are committed Christians, and this was a true test of our faith. I think the main thing that I learned through this is that we can make our plans and set goals, but God will do what He wants for His own purposes and for His own glory. We do not have guarantees that if we do ABC, then XYZ will automatically follow. Yes, we should be wise and prudent, but we must hold everything with an open hand. Now, that we have seen God’s provision and are on our feet again, my outlook is so different now. I think I would caution others to beware of financial formulas as if they are some kind of safeguard against catastrophe. There is only One we can truly trust. I guess you could say complete trust is my goal now! Thanks for sharing so much on your blog. Love it!
Thanks, that is a very good point. Bad things do happen and we cannot trust more in our bank account than in God. I do think that we need to prepare and handle our money wisely though. We lived for a long time in a kind of denial thinking,”Oh, God will take care of that.”, but I believe that He allowed us personally to suffer the consequences of our mishandling of money to get our attention so we would do a better job.
I’m sorry that you had to go through such a difficult time, but glad that things are better now. Thanks for sharing your story. 🙂
Love your blog. I need self control to spend money wisely. Thanks for encouraging me.
We all need self control Paige! 🙂