Making the transition to a one-income family

We didn't have much of a choice when it came to me becoming a SAHM, since my second child was born at 25 weeks and couldn't go into someone else's care. We had already accrued credit card debt the previous year from my bed rest with the first pregnancy. I also had a car wreck about a month before my second child was born, other driver's fault, totalling my car. Long story, short, I ended up having to pay off my car and buying a new one. Then I abruptly had to quit my job and we began relying on our credit cards even more.

Two years ago, we sold our house and moved in with my MIL. We just paid off the last of our credit card debt. Last month we bought 5 acres of land and we will get a construction loan and build our new home ourselves, keeping our mortgage to a number we have already determined. All other expenses will come out of our savings.

In August we will pay off my van. It still has 2 years left on the loan. Our only other debt is my husband's motorcycle. Our second car, we bought used and paid cash for. My husband has worked his ass off as a cop, picking up as many overtime shifts as he can in order to put us on the right path. I've learned to cut coupons and make things last. I've become quite a cheapskate. My children still are sharp dressers, but their clothes came off of last year's clearance rack (they're 3 and 5, so I can still get away with this)

We are now cash-only people. It's a good feeling. AND, there's a lot more cash because we're not wasting it all on finance charges and minimum payments! Once we get moved, my husband will be able to cut out his overtime, only picking up shifts here and there if we are saving up for something really big, like a big vacation, and I can stay home for a couple more years to manage my special needs child's education for the first years, then work as I choose.

We didn't cut out things like cell-phone, because I am constantly taking my son to a doctor, and my husband works a dangerous job, so we discussed it, but decided they were too important, as was having reliable transportation in Atlanta.

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We did this from the outset of our marriage, so the 'rules' may be a bit different, but here's what we did:

We had decided before we married that I would stay home if we had kids, and kids were definately in the plan, so we started with both of us having full-time jobs. We bought the house, two cars, the whole ball of wax. When he landed a new job in a new state and we moved, all of my income served to pay off debts (we had serious problems selling our house, which took a major toll on our finances). But once that was done, my salary went to savings. We were in an apt at the time, so it also went to a down-payment nest egg. We both needed cars, so we simply maintained ours well - we buy cars intending to keep them for around 10 years. Once we had enough for the house, we found a bargain (not cheap, but well within our range and a 30-year mortgage, no A.R.M.s for us!)

We never "went without", but we did go easy on the eating out, and we've never had cable TV.

FFwd to today, we both still have cars, we both have cellphones. We do not have cable, sattelite radio, or high-speed internet (but that one is because we're in the country where it's not offered).

I guess the best thing you can do, is plan from the beginning, and live the way YOU want. Don't let "The Joneses", or Cosmo Magazine, or anyone else dictate what your family needs. Only you know that. Cars CAN last ten or more years. You don't REALLY need cable TV (it's all reruns, anyway!), etc. You can find some real treasures at Goodwill, garage sales and other thrift shops, if you know what you want and are willing to be a little flexible.

The one place we DIDN'T skimp was with our investments and 401K's... we still contribute the max to my husband's investment programs and our son's college fund (which we started before he was born) so we know the future is secure.

Good luck.

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Well, it's a good thing that I don't look to about.com for financial guidance. Refinancing one's house is a terrible, harmful decision. People talk about purchasing a home so that they can "build equity," but they are oblivious to the fact that refinancing counteracts any built equity.

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Oh, yeah, and now, with food prices going through the roof, I've discovered that I have quite the green thumb. We grow most of our own vegetables, some fruits (mmm, strawberries!), and we're also fortunate, living in farm country, that we can buy our eggs cheap (.75 a dozen!!) from the neighbor, and we have a source for inexpensive, grass-fed, organic-but-not-certified beef, as long as we buy it in bulk. I am currently working on a source for milk...

I would suggest, if you have the funds, the space, and the desire... buy a deep freezer (they're not that expensive, and they pay for themselves), and learn to can your own veggies. You'll be happy, come winter, that you took the time to "put food up". A little expense at the begining saves you a whole lot in the end.

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Our best financial decision was waiting to buy our house until after my son was born and I made the decision to stay home with him. We always knew I might want to be a SAHM, but my husband and I weren't 100% sure until after our baby arrived. If we had bought our house pre-baby, we would've bought one that required two incomes to sustain. By waiting, we made a more fiscally responsible decision. That's always my only advice to young married couples. If possible, try and set up finances as if you're living on only one salary from the beginning, if possible. That way, if you do want to be a SAHM, or SAHD, you can do it. And if you decide to work, then you can really save.

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Like someone above said, a lot of it comes down to lifestyle choices, even way before you have kids. We live in a very affluent area, and my husband and I have always noticed that we just live differently than most people. Neither one of us has ever had credit card debt, we were not raised that way and we are teaching our daughter the same thing - live within your means.

I'll always remember when we were first married 14 years ago and rented a one bedroom apartment in a "transitional" neighborhood in San Francisco. (We have such great memories of that time, too.) Our friends, also newly married and right out of law school, rented a 3 bedroom house in a more desireable area across town. We paid $700 a month rent, they paid $2000 and complained that they would "never" be able to save a down payment to buy a house. We saved a down payment and bought a decent house in the suburbs 3 years later, our friends took 10 years, have a much smaller house now in an area with bad schools, and of course they both "have to" work full time.

There are so many things, big and little, that people can do to economize. It really comes down to learning to delay gratification, learning that "things" don't bring happiness, setting priorities and planning for the future from an early age.

Also, "staying at home" doesn't mean that the family has to live on one income forever. MANY people take a few years off when the kids are young and then go back to work part time when the kids are in school. If you get a decent education and have a little job experience under your belt, this transition is not very difficult.

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We've been a stay-at-home Mom family since we got married as we already had a child. We have 2 older vehicles instead of buying brand new cars. I conserve gas by walking my DD to preschool when the weather is good. We use pre-paid cell phones so there's no chance of surprise bills. I shop for groceries at 5 different stores due to food allergies, but I try to get as much "normal" food as I can , and I buy it at discount groceries. I make many things from scratch. I shop for clothing and odds and ends during clearance sales and at thrift stores. We do not wear rags by any means, I'm very picky about what I'll buy from a thrift store. We are definitely able to save money if we want to do things like go on a day trip or buy something relatively expensive, but it takes a little bit more work than if you have 2 incomes. We do have cable, and obviously internet, we just sacrifice things like eating out often (we go about 2 times a month, and bring our own food on daytrips) and buying things that we don't need (I get books from thrift stores and the library, and he gave up his morning prepared coffee for a coffee pot at the office). We talk a lot about money and always have a plan if we want or need something big. It can be done. :)

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LS,
When we finish building our house, (which incidentally will be in the country, 1.5 outside Atlanta, giving my husband an hour commute, one way to his law enforcement job,) I am going to try my hand at gardening and canning. Last year I learned how to can strawberries and we are still enjoying the *fruits of that labor*! We are also going to get a large upright freezer, because I will have to buy in bulk anyway and I am looking into purchasing a quarter or half a cow from a local farmer. Being a city girl, I'm not sure how that all works, but if it's better for my family and my pocket book, I'm willing to give it a try!

Just for the record, we were never credit card people, either. In fact, I'm almost 34 yrs old and have never had a credit card in my own name. My parents never had credit cards, either. My dad had one for his business, and my mom still has to use the ATM to get cash, or write a check because she doesn't even have a debit card. But circumstances come into play, and abusive ex-husbands, bed-ridden pregancies, super-early babies and forced resignations from jobs. We knew it wasn't the right thing, but babies need diapers and special formulas and doctors, and those things cost money. We did what we had to do to provide for our babies, all the while wringing our hands watching the debt rising higher and higher.

But, 2 years later and we are debt-free and on the road to living the life we want to. We are making plans for our future, which we weren't able to do while deep in the middle of the stress. My ex-husband would never pay cash for something he could charge, and when we got divorced, after 3 yrs of marriage, there was 30 thousand dollars in debt. I brought in zero dollars to the marriage, he brought in 16 thousand. I did nothing but go to school and work to try to pay off what he charged. I would never live that way on purpose.

Last I heard, he declared bankruptcy after we divorced and is now beating up on someone else.

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When we needed a bigger car, we bought an older van, cash. We have two cars, the newer of the two is a 1993. We have to pay for repairs periodically, but still not anywhere near what a car payment and insurance on a new car would be.

We don't have cable or a home phone - cell phones only.

We eat out maybe once a week, on average - that's including all meals prepared outside the home, fast food, restaurant, take-out. We eat mostly home-made food, make our own sweets and treats, very few processed foods. When we do eat out, we usually go to a buffet - everyone is happy and the price is about the same as a fast food place.

We don't do recreational shopping, and only go to a mall once about every 2-3 years.

We use cloth diapers, lots of washable reusable products. We cook in bulk and put portions in our deep freeze. We eat little meat. We just started a small garden to grow our own.

We check out lots of books from the library, only go to the movies about once a year.

We live really well on one income, I think. We have lots and lots of time together, we eat good homemade food, we have lots of fun. It is a choice, and we think we made the right one for us.

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