Have you ever wonder how a family can survive on one income? If you find yourself in that situation right now all of a sudden, don’t panic. You will survive.
I will share with you the lessons I learned living on one income after I was laid-off.
It never crossed my mind that I would lose my job one day just like that. I was getting ready to return after my maternity leave ended when they called me to tell me that they couldn’t have me back. They were going through a financial hardship and were laying off most of their employees.
It’s not that I was desperately wishing to go back as I was rather enjoying the time I was spending with my son, and was reluctantly accepting that I would have to take the baby to daycare.
I don’t have anything against daycares but, being a first-time mom; I didn’t feel comfortable leaving him with someone else.
However, we couldn’t survive with my husband’s income alone, even less without maternity insurance or any other money coming in. I needed it to do something and do it fast.
Let me give you a pic of our monthly expenses at the time.
| Expenses | |
| Mortgage | $1900 |
| Fixed and variables | $1300 |
| Total expenses | $3200 |
| Income | |
| My husband salary after taxes | $2600 |
| Other income | $300 |
| Total Income | $3150 |
As you can see, we had more expenses than the income coming in.
So this is the plan if you want to swim through the storm and make it safe to land.
7 Tips to survive on one income
1. Check if you are entitled to any benefit.
If you lost your job, make sure before anything else to check to see if you are entitled to unemployment insurance.
That was the first thing I did. But I had used my benefits with the maternity leave, so I wasn’t entitled to EI.
Your provincial government may also have something for you as well. Sometimes they provide extended employment benefits, but again I didn’t qualify.
Make sure you have applied to the Canada child benefit (CCB), which is a tax-free monthly payment made to eligible families to help with the cost of raising children under 18 years of age.
In this link, you can find all the benefits available to families and individuals in Canada.
Another thing that helped me was getting in contact with Ontario employment. They have many resources to help you, and you don’t have to be all over the place looking for information.
2. Time to budget
As much as a hated it, I needed to make a budget right away. I knew that finding a job would take time for me, especially an engineering job. So Budgeting was the next bullet point on my list.
I always associated budgeting with scarcity and limitations. That’s why I had never made a budget before. Still, it turns out that budgeting is required to allocate resources and expend your money efficiently; once I learned what a budget makes to your finance, I started budgeting and treating my house as a company. Every purchase was carefully planned for and still is.
3. Cut unnecessary expenses.
A budget will help you determine what expenses you can cut out your monthly bill. Think of things that you don’t need 100%. You can cut your phone bill by changing your company and looking for current promotions.
At this stage, every penny counts.
If you are going to be staying at home, the chances are that you don’t need a cellphone plan with data. You can use your home wifi to surf the web. And data is usually what makes cellphone plans so expensive.
In my case, I canceled my Gim membership, and that was $50 back to my pocket.
I didn’t cancel my cable because it was bundled with the internet, but I tried. Anyway, my plan was rather cheap already.
Suppose you can get rid of the cable, that would help. You can recur to free Tv alternatives, and you won’t be missing much.
4. Consider withdrawing from your Registered Retirement Savings Plan.
If you are against the wall and need money today, you can withdraw from your Retirement Savings Plan, RRSP, or 401k.
You won’t be declaring any taxable income at this time since you will be living on one income; therefore, you can borrow from your retirement plan at a lower tax bracket.
That I did, I withdraw from my RRSP.
5. Do not take big risks.
This isn’t the time to start a business or make huge financial decisions. Unless you have planned for this time, you are better off keeping it low until you figure out what your next move will be.
I am telling you this because that is exactly what I did. I got tired of looking for jobs and going to endless interviews and decided I wanted to go into business. It was a disaster!
All the money I had withdrawn from the RRSP went away, vanished!!. Ok, I got the experience, but that only served me to pass it on to you.
Thankfully one always finds his way around those tough times. But starting a business that requires considerable investment is not a good move.
This is a time to survive, and remember, you only have one income to rely on.
Don’t get me wrong, I have an entrepreneurial spirit, and I am always looking for businesses, but that was not the right time for it. It can make you more harm than good.
6. Ask for help
Don’t be afraid to ask for help if you ever need it. There are many community programs to help people going through financial hardship if that is your case.
This is a momentary situation that you will eventually overcome. So be open to receive help.
Sometimes we need emotional support to go through these times in life. But we have to recognize it.
Back then, I started going to Toast Masters meetings to surround myself with different people and broaden my horizons. It helped.
I also joined Mother’s Care, a community program destines for moms. They offered resources and support to help us cope with motherhood and child development.
The meetings were held on Thursdays. They would babysit the kids so we could meet and talk in a group about healthy recipes and any concerns that we had regarding our child.
Even a specialist joined us every meeting like a dietician, a dentist, or a doctor, to name a few.
7. Start looking for ways to bring money in.
Unless you have a wallet full of money, you will eventually need to do some activity to make money.
I used to have a huge Ego!, you’ll see, I was an engineer, and I thought that taking a different job would make me be less than I was. That is a misconception that is deeply rooted in the country where I was born.
You know what, that time helped me to take inventory of my strengths and weaknesses. I was wrong.
My priority became my son, and everything else started to matter less. We decided we would survive on one income to stay with my son for as long as possible.
I went to the bar of the neighborhood and ask for a job. That is when I started working a couple of hours at night. After my husband came from work, he would stay with the baby, and I would leave for work.
That was a lot of fun, actually. I could go outside to have some time for myself and still got to spend most of the day with my baby. Meeting new people, talking, and socializing with adults was a big change and a break from the home routine.
I needed quick cash, so that was the best way I found to make quick cash. And let me tell you this, little did I know that you can make big money working as a server!!
Long story short, I spend 9 months living on one income until I started making money on the bar. We survived on one income.!!! So can you.
You can do other things to make money fast, especially if you read this during the lockdowns. Your best bet is to look for online jobs.
There is an abundance of opportunities to make money online, from Surveys to freelancing and more.
I was a little skeptical at first about going online. It was something I thought to be unrealistic. That until a friend of mine told me about their digital marketing business, which brought me to blogging.
To summarize
Be open to new concepts and ideas. It is like someone said if you only do what you can do, you won’t be more than what you are now.
Don’t get too hung up in the day and the time you are living. It would be best if you look forward to the future with sunny days ahead. You have to believe it.
Take accountability for your life and set your priorities accordingly. This is a break the life is giving you to set sails for a new chapter in life. If staying at home with your baby is what you want, then enjoy it. Your baby will be this little just once. Everything else can wait.
And be sure of this, anyone can survive on one income.
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