Living on One Income StreamMarch 9, 2015
When it comes to financial matters, one of my biggest influences happens to be my wife. Some of my proudest financial accomplishments came directly from her encouragement. Paying off my student loans, saving and paying for our honeymoon in cash, building up a quick freedom fund – yep, it was my wife’s doing.
A few weeks after we got engaged, she took me out to eat, sat me down, and laid out a great plan for handling our finances once we were married.
Her plan was simple. If we both intended on working, we would be a one income family. The second income stream would go towards things like travel, paying off my student loan debt, and extended savings; essentially, things that weren’t mission critical (debt is critical, but I was already paying it down little by little every month, so it wasn’t being neglected) would be paid for with the “extra” money.
The key idea was that if one of us were to lose our job or we decided to have children and one of us stayed home, our lifestyle wouldn’t be terribly impacted. Bills would still get paid and mouths would still be fed.
I’d love to tell you that I listened with an open mind and had an engaging conversation with her about this idea. Haha.
I hated it! Was she serious? What if that single income stream wasn’t enough to give us a comfortable lifestyle? How would we ever make it?
Looking back, I feel that my resistance to this plan came from an unhealthy view of money management. In my early twenties, I definitely wanted the things. A second income stream meant more things. Things! Saving money wasn’t nearly as awesome then as it is to me today. Certainly, investing definitely wasn’t even a consideration.
Cut to almost two years later, and we’ve lived on one income stream for the entire time. As many men have said before of their wives, she was right. Using the secondary income stream, my student loan debt was paid off in seven months, we’re nearing enough savings to give us a full emergency fund, and we’ll soon be paying cash for a trip to Greece. Meanwhile, the primary income stream is paying the bills and keeping us fed and happy.
Many wise people say to live below your means. My challenge to you, however, when you’re married, is to consider your means as the income of only one spouse. You can even choose whether the primary income stream is the higher-paid spouse or the lower-paid spouse (there’s are pros and cons to both options, but again, it’s your choice).
While it was easy for us to adopt this lifestyle being young and newly married, it can certainly be a stretch for some of you who may be well into your marriage and relying on two income streams to make ends meet. We’ll dive into that in future posts – saving more and living on less.
Until then, remember – stop spending so much, and save money, dammit!