Has the pandemic brought your family down to a single income? With more than a million jobs lost in Canada, many families are in the same boat. Whether you were laid off or were required to stay home with your children who couldn’t go to school or daycare, it’s important to know how to budget your single family income.
Even if you collect unemployment, for now, it may not last. Just in case, consider the following ways to budget your single family income.
It’s not a pleasant thought, but you must cut expenses. Get creative here. For example, if you cut cable, can you afford to replace it with a streaming service? Netflix, for example, costs a fraction of standard cable services. See if you can work it into your budget so you don’t feel like you’re sacrificing too much.
Think of other places you can cut, such as:
· Eating out
· Grocery store (shop sales and clip coupons)
· Household goods (shop sales or comparison shop online)
Redo your Budget
Take an honest look at your budget. Where do you spend? If you can’t cut in certain categories, where does that leave you each month?
Think about saving for an emergency fund and retirement. Both should remain line items on your budget even when you’ve gone down to one income.
Pay with Cash Only
Credit cards are tricky. They can protect you when making large purchases, but they can quickly put you into debt too. When you’re living on a single income, only buy what you can afford in cash. If it’s a large purchase and you want the credit card protection, make sure you have the cash to pay the balance off in full. Make sure you pay the balance by the due date and don’t tempt yourself with the low minimum payments.
Declutter and Make Money
Going down to one income is a great reason to downsize. Look around your house. What are you holding onto that you don’t use? Furniture, clothing, appliances, and stuff you’ve collected for hobbies that just collect dust may make you money.
List your items on Craigslist, Facebook Marketplace, or LetGo and make money on it. Stash the money away in your emergency fund and resist spending it.
Start a Side Gig
If you create your budget and come up short, consider a side gig. There are many side gigs you can start online, such as freelance writing, graphic design, and web design. In-person, you could start a dog walking business, babysitting, or landscaping service. Think about what you love to do and make money doing it.
Whether you’re budgeting on one income for reasons you can’t control or if you’ve decided it’s for the best, take time to create your new budget. Be honest with yourself and see where you must cut to make ends meet. At first, it may feel like a sacrifice, but in the end, everyone will feel less pressure and more freedom with the workable budget and the more quality time they can spend with one another.