[{"@context":"https:\/\/schema.org\/","@type":"Article","@id":"https:\/\/moneydoneright.com\/personal-finance\/saving-and-budgeting\/living-on-one-income\/#Article","mainEntityOfPage":"https:\/\/moneydoneright.com\/personal-finance\/saving-and-budgeting\/living-on-one-income\/","headline":"17 Secrets to Living on One Income (Without Being Rich)","name":"17 Secrets to Living on One Income (Without Being Rich)","description":"It\u2019s common for many families to eventually live on one spouse\u2019s income. Ideally, you’ll...","datePublished":"2020-01-31","dateModified":"2025-03-20","author":{"@type":"Person","@id":"https:\/\/moneydoneright.com\/author\/josh-patoka\/#Person","name":"Josh Patoka","url":"https:\/\/moneydoneright.com\/author\/josh-patoka\/","identifier":46,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/463db8f06cfc56c692d59cefeaba197f1c0cc65e02255afff269c683a2531ade?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/463db8f06cfc56c692d59cefeaba197f1c0cc65e02255afff269c683a2531ade?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"Money Done Right","logo":{"@type":"ImageObject","@id":"https:\/\/moneydoneright.com\/wp-content\/uploads\/Money-Done-Right-Personal-Finance-and-Investing-Blog.png","url":"https:\/\/moneydoneright.com\/wp-content\/uploads\/Money-Done-Right-Personal-Finance-and-Investing-Blog.png","width":488,"height":60}},"image":{"@type":"ImageObject","@id":"https:\/\/moneydoneright.com\/wp-content\/uploads\/living-on-one-income.jpg","url":"https:\/\/moneydoneright.com\/wp-content\/uploads\/living-on-one-income.jpg","height":460,"width":1900},"url":"https:\/\/moneydoneright.com\/personal-finance\/saving-and-budgeting\/living-on-one-income\/","about":["Saving Money"],"wordCount":2928,"keywords":["schema"],"articleBody":"It\u2019s common for many families to eventually live on one spouse\u2019s income.Ideally, you’ll have plenty of time to prepare for living on one income.But even if a surprise life event drops your income overnight, it\u2019s still possible to live within your means.Using the tips below, my wife and I were able to afford a 60% pay cut in 2015.We went from earning $80,000 to $35,000 when our first child was born.Granted, living in Tennessee, our dollars go a lot further than in other places, but nevertheless I\u2019ll be the first to admit that it was scary making significantly less money.However, we have never missed a bill due date and still save money for the future.If possible, try adopting these new practices while you still earn dual incomes.You can practice living on a smaller income and keep increasing your savings with your extra income.Table of ContentsToggleCut Expenses1. Make a Spending Plan2. Cut Recurring Subscriptions3. Switch to Prepaid Services4. Cook Your Own Meals5. Pay Off Debts6. Requote Insurance Premiums7. Buy Used Items8. Avoid Impulse Purchases9. Save for Large Expenses10. Maintain an Emergency FundMake Money11. Side Hustles12. Sell Unwanted Items13. Use Cashback Shopping AppsEarn Passive Income14. Invest at Least 10% of Your Income15. 401(k) Matching Contributions16. Make IRA Contributions17. High-Yield Savings AccountsSummaryCut ExpensesThe quickest way to adjust to your new income is by reducing your monthly bills. It\u2019s not easy spending less money at first. It gets easier once you establish a new routine.1. Make a Spending PlanWhen you earn a high income and have low expenses, it\u2019s easy to think money grows on trees.In our case, we could buy anything we wanted most months and still set money aside for large expenses.On a small income, there are some months when you must either make a large purchase or put your extra income in savings.For instance, I rarely balanced the checkbook when we had a 50% savings rate.But when we went from saving half of our take-home income to living paycheck-to-paycheck, we needed to know how we spent every penny.We wrote every expense down for 30 days, including:Utility billsGroceriesInsuranceEntertainmentGasInvestingSaving for upcoming expensesAfter seeing where your money goes in a typical month, decide which expenses are \u201cnon-essential” and try canceling or reducing these bills.Then repeat the tracking exercise for the next month to see what else you can adjust.It can take several months to fine-tune your spending plan. Using a free budgeting app is an effortless way to track spending or make a basic budget.If you can afford $84 a year, I highly recommend YNAB.We used it for our first year living on one income until we got into a new money routine.This tool is one of the most thorough ways to track spending and plan for uncommon expenses.2. Cut Recurring SubscriptionsThe easiest expenses to cut first are your recurring monthly bills.We canceled streaming plans we rarely used and other home delivery services that were nice to have.All of those $10 to $60 monthly charges quickly turn into a large sum.Trim is a free tool I use to negotiate lower bills.I get an occasional discount on my cellphone and home internet plan.3. Switch to Prepaid ServicesWhen possible, switch from contract services to prepaid plans.Instead of renewing your cable TV contract, try switching to Hulu with Live TV.Not only can you pay less money, but you can cancel penalty-free.For instance, you may watch cable TV only during college football season.During those months, you subscribe to a live TV cable alternative but cancel once bowl season ends.You won\u2019t pay a cancellation fee or a reactivation fee.We also switched to a prepaid cellphone plan.For the same monthly price, my wife and I get double the data.On our old plan, we paid a data overage charge several months each year (although paying the fee was still cheaper than upgrading to a more expensive plan).4. Cook Your Own MealsAnother eye-opening expense for me was my annual restaurant spending.On average, I spent $20 each workday on dining.That comes to about $5,000 in restaurant meals each year.The same meals could have been cooked at home for a fraction of the cost. Today, I rarely go out to eat, and we cook almost every meal at home.At a minimum, buy premade meals from the grocery store freezer section.They can be cheaper than going out to eat.Better yet, make a meal plan and buy fresh ingredients.For instance, the official USDA food plans estimate a family of two with a moderate food budget spends $612.40 monthly.A family of four with two children between ages 6 and 11 will spend $1,060.50 per month.Your expenses may be higher or lower, but this is a good benchmark.Check It Out: This credit card gives 6% cash back on groceries.American Express Blue Cash Preferred(R) Card\t\t\t\t\t\t\t\t\t\t\t\t\t\t.st5-27831.btn.btn-default:hover{border-color: #4db848;color: #4db848;background: #fff !important;}\t\t\t\t\t\tLearn MoreWe earn a commission on this offer.\t\t\t\t\t\t\tBasics: The Blue Cash Preferred offers 6% Cash Back on your first $6,000 in purchases at U.S. supermarkets per year, 6% Cash Back on select U.S. streaming subscriptions, 3% Cash Back on transit purchases, and 3% Cash Back on all your purchases at U.S. gas stations.Welcome Offer: There is a welcome offer of $350 with $3,000 spend within first six months from opening the account. Terms Apply. (See Rates and Fees)Bottom Line: If you have a large household with a lot of hungry mouths to feed, the Blue Cash Preferred with its whopping 6% cash back at U.S. supermarkets could be a great fit for you.\t5. Pay Off DebtsLiving on one income is also easier when you become debt-free.We still had a mortgage payment when we began living on one income.That loan is now paid off, and we no longer have a $700 monthly payment.In our case, becoming debt-free was like an instant $8,400 salary increase.If you\u2019re in debt, focus on paying off your high-interest balances like credit cards first.Make extra payments whenever possible.Make sure the extra payment applies to the loan principal.The less you pay in interest means the sooner your remaining loan balance disappears.Also, avoid going into debt when making large purchases.One way we save money is by paying cash for used vehicles and vacations.Other ways you can pay off debt sooner (besides extra payments) include:Consolidating your debts into a personal loanAsking your credit card company for a temporary purchase APR decreaseRefinancing your existing loans (home, auto, student loans) for a lower interest rate6. Requote Insurance PremiumsIt\u2019s a good idea to compare insurance premiums once a year since another provider may offer similar coverage at a lower price.Gabi is a great place to start to compare auto insurance rates for free.You might be able to save extra money by bundling your products.For instance, we have our homeowner\u2019s, life insurance, and rental property insurance all at the same agency to get a multi-policy discount.You may also need to buy standalone life insurance.Previously, I used my employer\u2019s term life insurance policy.My wife and I both have term life insurance to financially protect our family if the unexpected happens.7. Buy Used ItemsWhen possible, we try to buy used items before buying brand-new from a retail store.Some examples include cars, clothing, furniture, and kitchen appliances.We scour Craigslist, Facebook, and eBay for deals.If you can wait several weeks or months to make a purchase, you have more time to find the best deal.8. Avoid Impulse PurchasesAll of us have varying degrees of willpower.For example, I don\u2019t go down the chips or candy aisle of the grocery store without buying something.Although this is an extreme example, some people \u201chave to\u201d buy a new car after going on a test drive.Here\u2019s how we avoid expensive impulse buys.We set a spending limit where we must wait at least 24 or 48 hours to make a large purchase.In our case, my wife and I discuss making purchases above $100.Our spending plan has enough wiggle room where we can make a small purchase, like a cup of coffee, if we want it.9. Save for Large ExpensesAs a dual-income household, you may currently have the ability to pay for large expenses with a single payment.For example, you can buy two $3,000 plane tickets while paying your normal monthly bills in full.On a single income, this may no longer be possible — unless you pull from savings or carry a credit card balance, which I don\u2019t recommend if you don\u2019t have too.These are your four best options to save for large purchases:Put small amounts of money into a dedicated account each month.Delay the purchase until you can pay in full with cash.Look for a cheaper alternative.A combination of the above options.We set aside money into separate savings accounts for vacation, property taxes, and new vehicles.This budgeting strategy is adopted from Dave Ramsey\u2019s Envelope System.You spend how much money is in the envelope and don\u2019t borrow from another one to pay the bill.10. Maintain an Emergency FundHaving an emergency fund is essential.Make sure your fund can afford one month’s living expenses.Because we live on one income, we keep a six-month emergency fund.Having this much cash may seem extreme to some.But you\u2019ll be glad to have the extra cash if the sole breadwinner loses their job.It can take several months to replace your current income.Saving for six months of expenses may seem difficult.Reducing your recurring monthly bills means your current savings can last more months.For example, you need $15,000 in your emergency fund to cover six months of $2,500 monthly expenses.And you need only $12,000 if you trim your monthly bills to $2,000.Make MoneyAll of us can only cut spending so much.Like you, I\u2019m not ready to go homeless or stop eating to drop my monthly expenses to $0.It can be easier to make more money to survive on one income than continuing to cut spending.11. Side HustlesMy wife and I both use our free time to make extra income with a side hustle.For instance, she works from home part-time teaching music lessons.I keep our children during these hours so we don\u2019t have to hire a sitter.One day a week, I tutor high school students to make extra money.Thanks to the internet, it\u2019s easier than ever to earn a side income from home.You no longer have to work at a restaurant or retail store on nights and weekends to make extra money.We all have different skills and interests.Here are some of the different ideas you can pursue:Freelance online (graphic design, writing, virtual assistant)Tutor English onlineMow lawnsBe a local photographerDrive for Uber or Lyft12. Sell Unwanted ItemsWe also sell unwanted items for cash.Some of our friends try selling anything that hasn\u2019t been used in two years.Not only do you declutter your house, but you make money in the process.Start by selling local on Craigslist and Facebook Marketplace.Both platforms are free.We sell clothing, video games, kitchen gadgets, and other items we don\u2019t really use.For small items with low shipping costs, consider posting them on eBay and Amazon as well.Remember that your seller fees are approximately 13% of the final price.If you offer free shipping, this cost also reduces your profit margin.I also sold valuable items that I didn\u2019t need.For example, I sold my 2012 Ford Mustang GT for $20,000.Even though I didn\u2019t have a car loan, the money was more useful than a fancy car quickly depreciating in value.We used half of the proceeds to buy a family-friendly vehicle (no loan!).The other half went into savings and making an extra mortgage payment.See what other big-ticket items you have that are nice to own but not necessary.If you\u2019re still making loan payments on the items you sell, use the first portion of the proceeds to pay off that loan.13. Use Cashback Shopping AppsAnother way we get a few extra bucks each month is by using cashback shopping apps.These apps are free and don\u2019t increase the price of the items you buy.For most online purchases, we get up to 10% cash back using Rakuten (formerly known as Ebates).Simply activate an online shopping session before you pay for your purchase.Once your balance reaches $5, you get paid by PayPal, paper check, or gift card at the end of the current calendar quarter.You can also get money back on groceries. I personally like Ibotta.Download the app to your phone and activate the digital offers.Then upload a picture of your receipt so Ibotta can match your purchases with the active offers.You can redeem your rewards for PayPal cash or gift cards.Earn Passive IncomeOne of the most difficult transitions for me was having less money to invest.Consequently, it\u2019s harder to earn passive income.Living on one income doesn\u2019t disqualify you from earning passive income.But since your annual salary is lower, passive income plays a more important role in building net worth.While you\u2019ll probably have less free cash to invest, it\u2019s still important to invest at least something.Keeping our expenses low and having side hustles are two ways we can invest.14. Invest at Least 10% of Your IncomeA general rule of thumb is to invest at least 10% of your income for retirement.This is good advice if you start saving in your 20s.But if you start in your 30s or later, you may need to contribute more to \u201ccatch up.\u201dAt least 15% or 20% or your household income may be necessary to meet your retirement goals.Robo-advisors like Betterment make it easy to invest small amounts of income.Each investment only needs to be at least $10.Betterment invests your cash into a mixture of stock and bond index ETFs that align with your risk tolerance.Another reason I like Betterment is it also offers retirement accounts.All your investments can stay in one place.15. 401(k) Matching ContributionsIf your employer matches a percentage of your 401(k) contributions, maximize this benefit.This is like an indirect salary increase.Since you can\u2019t touch the cash until retirement, you don\u2019t risk spending this money on short-term expenses.How much you contribute after your 401(k) match depends on if you have a good plan or not.What if the plan has high fees or lacks index funds and target date funds?Your best option might be investing your extra income into an individual retirement fund.16. Make IRA ContributionsFor money you don\u2019t need until retirement, invest using an individual retirement account (IRA).You can invest in just about anything your broker offers, including target date retirement funds, index funds, and individual stocks.You pay taxes on these contributions only once. When you pay income taxes on your contributions depends on which IRA account you choose.Traditional IRA vs. Roth IRATraditional IRA contributions grow tax-deferred. This means your taxable income is reduced for the current tax year. But you pay income taxes on the withdrawal amount in retirement. So if you make $35,000 a year and contribute $6,000, your taxable income is $29,000 excluding any other deductions.Roth IRA contributions grow tax-free. You pay income taxes on the contribution amount for the current tax year. But you don\u2019t pay taxes on withdrawal amount or capital gains again.Each person can contribute up to $6,000 in 2020 in total IRA contributions. Once you turn 50, you can make an extra $1,000 catch-up contribution each year. You may make only one type of contribution or split between a traditional and Roth IRA. An even split would be $3,000 into a traditional IRA and $3,000 into a Roth IRA.To avoid potential tax penalties for overcontributions, please review the current IRA contribution limits.17. High-Yield Savings AccountsIn addition to having an emergency fund that can cover between three and six months of living expenses, keep putting some money into a high-yield savings account.For instance, the money we save for large purchases goes into these accounts.We also have money that isn\u2019t in our emergency fund but we can use for other near-term expenses like car repairs, home repairs, or medical bills.Make sure these accounts are fee-free.Otherwise, the account maintenance fees can cost more than the interest you earn.SummaryLiving on one income can be difficult without a routine.The first thing you need to do is make a spending plan to spend less than you earn.Finding ways to reduce expenses and earn extra income can make it easier to live within your means.Are you currently living on a single income? What\u2019s your greatest challenge? What else do you do to manage your money well?Responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and\/or questions are answered.To see the rates and fees for the American Express cards featured, please visit the following links: Blue Cash Preferred(R) Card from American Express: See Rates and Fees"},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Personal Finance","item":"https:\/\/moneydoneright.com\/personal-finance\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"Saving And Budgeting","item":"https:\/\/moneydoneright.com\/personal-finance\/\/saving-and-budgeting\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"17 Secrets to Living on One Income (Without Being Rich)","item":"https:\/\/moneydoneright.com\/personal-finance\/saving-and-budgeting\/living-on-one-income\/#breadcrumbitem"}]}]