“I don’t know how you do it” is a common reply I hear when someone finds out that I’m raising a family of six and thriving on a single income in Seattle, one of the least affordable cities in America (it’s the 8th worst).
Most of the time that’s where the conversation ends. I go my way and whomever I was talking to goes theirs. But every now and then someone will come back later and ask “seriously, how do you do it?”
I have a hunch most people are secretly hoping that I’ll let them in on some little known life hack that only I know about. I wish I had that information to share, but all I have to offer is what has worked for us as we’ve built a situation that allows us to not only get by, but thrive financially.
There’s no secret. Just some common sense, hard work, and if I’m honest – a little bit of luck too.
HOW WE’RE THRIVING ON A SINGLE INCOME
My wife and I have four kids, aged 17 to 7; three boys and one beautiful flower in the middle of our weed patch. I work full time as a marketing manager and my wife works overtime as a stay at home mom. Together we have one income and we’re thriving financially.
Yes, thriving on a single income. While that’s a subjective word I think it’s appropriate since we’re able to not only pay our bills on time and save for retirement, but we’re saving and investing for financial independence and an early retirement. We also live in a near-new home, drive a brand new car, take multiple vacations each year, sign the kids up for activities like swim lessons, little league, and gymnastics. I call that thriving on a single income.
These are five things we’ve done throughout our twenty years of married life to make this possible.
BE PATIENT
We didn’t get in this position overnight and we’ve not always been able to thrive. Sometimes we were barely able to survive. My wife and I got married young (21 and 20). The early part of our marriage was tough when we were broke and I was a car salesman working on commission. I still remember times when I didn’t sell any cars during the pay period and received no check on payday. Those “paydays” were painful. It didn’t take long to realize how bad that sucked and that I wanted something better.
My dad always told me “make it be a good day.” The essence of that advice is personal responsibility. Nobody was going to hand me a better life so if I wanted more out of mine, I needed to work for it. So that’s exactly what my wife and I did.
Hard work alone isn’t enough. You’ve got to work hard for a long time, continually improving your situation. There are only two ways that I know of for someone to get rich quick. One way involves breaking the law, the other involves breaking the laws of probability. Don’t waste your time chasing either option. Getting rich quick takes time, but it doesn’t need to take a lifetime either.
Roll up your sleeves, get to work, set yourself up for success, and be patient.
SET YOURSELF UP FOR SUCCESS
If you don’t like where you’re at in life, do something to change your situation. I didn’t like being a broke, mediocre salesman (neither did my wife), so we changed things up by deciding to send me back to school to get my college degree. We knew that a college diploma would provide better opportunities and a more stable income. Although going back to school full time meant we’d temporarily make even LESS money than we were already making, that was the price that needed to be paid.
One way or another, you’re going to work hard during your lifetime. I figured I might as well get paid well for that hard work.
So I loaded up my class schedule to graduate as soon as possible. While in school I started a marketing club on campus as a way to differentiate myself from other graduates. I used that marketing club as a way to network with local business leaders that I solicited to come and speak to our group. When graduation day finally came, I had a solid network already built and found a good job in no time.
Humans are terrible at predicting what will make us happy, but we’re pretty good at recognizing what won’t bring us happiness. If something in your life sucks – eliminate it. Relentlessly eliminate the BS from your life and eventually you’ll have a life that’s largely free of the BS.
FOLLOW OPPORTUNITY, NOT PASSION
Sorry, but it’s true. I know that you dreamers out there don’t like to hear this, but very few of us get to do what we’re passionate about for a living. My advice: save your passion for your hobby – follow opportunity to build your fortune.
Of course you don’t have to follow opportunity, but if you’re trying to thrive financially, then you’ll almost certainly be better off if you do. Think of it this way – you can spend your golden years pursuing your passions but use your peak earning years to earn a buck.
BE FLEXIBLE
So much about ‘setting yourself up for success’ and ‘following opportunity’ requires flexibility on your part. In our case, we moved from a low cost of living state with limited job opportunities to Seattle, Washington. Sure we now live in a high cost of living city, but high paying jobs are abundant.
Seattle is home to some of the biggest and most well-known companies in the U.S., if not the world. Microsoft, Amazon, Costco, REI, Eddie Bauer, Nordstrom, T-Mobile, Nintendo USA, Starbucks, and so many others are all headquartered here. To thrive, we’ve had to follow opportunity and set ourselves up for success and that meant we’ve had to move far away from family, friends, and all that was familiar to us.
Had we not been flexible, we’d still be living in a low cost of living state with limited job opportunities for someone with my background. I’m sure we’d be fine, but would we be thriving? I don’t think so.
SACRIFICE
There’s a quote that says “you can do anything, but not everything.” That’s so true and it applies to personal finance as well. You can have anything, but you can’t afford to have it all. In our case, we’ve decided that the best thing our money can buy is freedom.
Here are a few of the things we’ve done or given up throughout our marriage to make thriving on a single income possible:
- Traded in our Mercedes GL450 for a bus pass
- Moved out of the million dollar home that we were renting and into something that nobody would mistake for a million dollar home
- I drove a 20 year old car, with unknown mileage, for years
- My wife drove a 12 year old used minivan with high mileage for years
- We’ve completely eliminated our second car
- We moved into my parent’s basement
- We moved into my in-law’s basement
- We uprooted our kids and relocated over a thousand miles away from family & friends
- We have taken fewer destination vacations
All of these things were done to help us get ahead financially in some way. Most of the things we’ve given up were nothing more than expensive luxuries that didn’t make us any happier than we are today without them.
The million dollar home? It’s the people inside the home that make me happy, not lumber and paint.
The Mercedes? The bus gets to me to work just as well as the Benz did. I’ve been taking the bus to work for over a year now, losing weight, and saving a small fortune along the way.
PRIORITIES
At the end of the day getting by and thriving on one income really boils down to priorities. You either sacrifice for the things you want, or the things you want become the sacrifice. Looking back now I am SO happy that we prioritized our long term goals over our short term desires. Our lives are better today because we did.
If you want the new home, fancy car, and amazing vacations then you’ll probably not be able to thrive on just one income. If you’re trying to do those things and raise a family then you’ll most likely need two incomes to make that happen. And that’s fine if that’s what you want.
We could have the nicer home in the right neighborhood. I could park a BMW and a Rover in the drive way, but these things would make saving impossible and would certainly require us to get back into debt. My Break Even Point would be near the end of the month, rather than near the beginning.
No thanks. These days I’m much more interested in buying my freedom rather than stuff that’s going to become garbage someday.
If you want those things, then great. I’m not going to judge you. I strongly believe that everyone is free to pursue that which makes them happy. But you’re reading a post about thriving on a single income, so I assume that’s what you want as well. If that’s the case, then this is my advice.
HOW YOU CAN THRIVE ON A SINGLE INCOME
First, I’m making a couple of assumptions:
- That you can get by on two incomes, but want to be able to eliminate or save 100% of one of them.
- If you already live on a single income, you’re interested in thriving on it (and not just making it work).
Transitioning from dual incomes to living off a single income requires change, and the most difficult thing to change is your mindset. But once you’ve accomplished that, the rest is easy. You can absolutely thrive on a single income, you just need to start thinking and acting differently.
1. ASSESS YOUR CURRENT FINANCIAL SITUATION
Begin by taking a financial inventory. If you’re going to create a plan, you’ll need to understand what you’re working with.
- What’s your TRUE income? How much of your money do you get to keep?
- How much are you really spending? If you don’t know – download a free money management app like Mint and start tracking your expenses today.
- Mind the gap. The difference between what you make and what you keep is vital. Do all you can to increase that gap.
2. ASSESS YOUR FINANCIAL GOALS
Once you have a clear picture of your true financial situation you can then set a realistic goal. To give yourself the best shot at reaching your goal, make it S.M.A.R.T.
- S -Specific
- M – Measurable
- A – Agreed Upon
- R – Realistic
- T – Timely
Specific
Your goal should be detailed, not vague and open to interpretation.
Measurable
Make your goal quantifiable. Add in dates and real numbers that are easy to measure.
Agreed Upon
Everyone involved in your plan needs to be on board (including yourself!). You’ll have a hard time reaching your goal if everyone isn’t on the same page.
Realistic
Be realistic with yourself. Setting a goal that’s just not feasible will lead to discouragement and probably derail your plans.
Timely
(Or Time Bound). You need to give yourself a finish line. A clear ending which signals success or failure.
A SMART EXAMPLE
“By this date next year we will be thriving on a single income, defined as:
- On my paycheck alone, we will
- Have the ability to pay all bills and other financial obligations on time
- Be able to max out my 401(k) contribution
- Be able to max out my Roth IRA contribution
- (if you have a second income)… Save 100% of our second income
Additionally, by this date next year we will have reduced our current monthly financial obligations by 30%. To do this we will:
- Eliminate our second car payment by selling the car
- Pay off the existing credit card balance using proceeds from the sale of the second car
- Cut the cord; no Cable or Satellite TV service
- Make an additional $200 principal payment on the mortgage loan until we have a 20% equity position and can eliminate PMI; this should take 10 months.
Lastly, at my next review at work I will ask for a 5% raise, which is 2% more than I normally get in my annual cost of living increase. I’ll justify this pay increase to my employer by:
- Showing how my contributions over the past year produced a larger than expected contribution to the company’s annual revenue targets”
Now that’s a S.M.A.R.T.goal!
RECAP
Getting to the point where we can thrive on a single income hasn’t been easy. We’ve gone through some dark times that pretty much wiped us out financially. We’ve made sacrifices. We’ve given up some luxuries that were pretty nice to have, but for us that’s exactly what it takes to thrive on a single income while trying to raise a family of six.
Sorry if you were looking for a different answer or some crazy life hack that would make all of this easier, but that just doesn’t exist. The good news, however, is that it can be done. All it takes is hard work, sacrifice, support from your family, and a little bit of luck as well, but even luck isn’t totally out of your control. I’m a big believer that you create you own luck.
The harder I work, the luckier I get.
Today I feel like the luckiest man alive to have four amazing kids with my high school sweetheart, whom is able to stay at home with them and be a full time mom. I might not be rich yet, but I’m beyond wealthy.
Chime In!
Could you thrive on a single income? Are you able to thrive with a dual income? Have you had to sacrifice anything in order to meet your financial goals? Please let me know if the comments!
- Ty Robertshttps://www.campfirefinance.com/author/ty-roberts/
- Ty Robertshttps://www.campfirefinance.com/author/ty-roberts/
- Ty Robertshttps://www.campfirefinance.com/author/ty-roberts/
- Ty Robertshttps://www.campfirefinance.com/author/ty-roberts/
- Ty Robertshttps://www.campfirefinance.com/author/ty-roberts/
LIGHT A FIRE UNDER YOUR RETIREMENT!
Love this post, Ty! But, then, I’m a little biased. 🙂 We thrive on one income – and have for the past 16 years. In the beginning, it was very difficult. Between student loan debt, a (stupid) car payment, and a mortgage, losing that second income meant developing a super frugal lifestyle. But, it was all worth it. No regrets.
At our house, there’s no “his” money and “her” money. It’s “our” money, regardless of who earns the paycheck. Beyond getting finances under control, I think communication and support between Alan and I has been the secret to our success.
I’m so glad you brought up the “my money vs. your money” thing. That can work in dual income households, but isn’t healthy in a single income home. Both of us do things to make our income possible, so it’s not “my” income -it’s ours. Just like our kids aren’t “hers” simply because she spends more time raising them. Thanks for adding this to the post, @amandacentsiblyrich:disqus
Yes and no. Because I’m a pain in the butt 😉 Our budget now (before I blow it up with my leave in a few months) says we save 45% of our after-tax income. Realistically, it’s more than that, especially when you throw in side hustles. Where things get hairy, though, is that our salaries aren’t equal. By about $25K at the moment. And now the breadwinner is hanging up her paychecks for three months. I should blog about this, huh? 🙂
This post is a fantastic reminder that things work out better (maybe not perfectly) when people are willing to put in work. There are tons of other factors, but work matters a great deal!
lol. That’s just the pregnancy talking @disqus_Y01qq9w8VQ:disqus 🙂 There’s a quote that I won’t bother looking up right now that goes something like “everyone wants to be successful until they learn what it takes”. I’m sure I just butchered that, but the meaning is there: almost anything worth having takes a lot of work.
Big fan of this post, Ty!
Realistic and agreed-upon financial goals are HUGE for success in marriage, in this divorce attorney’s opinion. Really, the absence of any one aspect of your S.M.A.R.T. goals can easily leave either one or both potential income earners feeling underappreciated/overworked and generally disappointed with life in a way that just breeds contempt, which eventually spread into other parts of the marriage. Maybe I’ll start sharing this outline with prenup clients!
Team together – team apart. The ride is bumpy enough when you’re both on the same page. It’s gotta be impossible if you both have different goals. A strong case could be made for adding another key element to this post: “compromise.” It’s unrealistic to think that both couples have the EXACT same goals, but a good team will find a way to compromise and work together.
I’m SO impressed with everything you’ve been able to do on one income. The focus on your purpose and working together as a team is key! I really love this line – Hard work alone isn’t enough. You’ve got to work hard for a long time. None of this happens “over night” and persistence and patience are what really take you far. You’re a great example of that!
well that’s high praise coming for you @vickimakesmarterdecisions:disqus – thank you! If there’s one thing I learned growing up as the son of a dry waller it’s how to work hard.
Let’s see, yes, I can thrive on one income…that’s my only option! 😉 But seriously, realizing the benefits outweigh the negatives. Accomplishing FI is such an insanely exciting lifestlye that any sacrifice is worth it. So you lost a Benz? Taking the bus is an awesome opportunity to people watch – especially in Seattle! And again major points for Husband of the Month to point out that your wife works overtime at home…you’re wealthy all right! Now send me this newsletter so I can check out those finances… 🙂
Don’t get me wrong, the Benz was very nice, but at the end of the day I want FI more than I want a luxury ride. And you’re right, the bus is LOL amazeballs sometimes. That’s nice of you to say re: Hubby o’the Month – I tell my wife all the time how lucky she is to have me! 🙂
We do it too, Ty, even after having royally messed up our money and gotten into major league debt. My husband currently makes well under 100k a year. We rarely go out to eat or to the movies, instead choosing to cook restaurant meals at home and watch movies at home on Netflix. We do lots of free or cheap entertainment, such as hiking, fishing, biking. We choose our vacations carefully and plan out paying in advance. We spend on what’s most important to us: working toward financial freedom so that we can continue to make family and serving others a priority. It works. You just have to cut out the junk and stop nickel and diming yourself into poverty. It truly is amazing how all of those small expenditures add up to paycheck-to-paycheck living.
“We spend on what’s most important to us: working toward financial freedom” — that’s it right there. You’re chasing what makes you happy and so are we!
Ty this is one of the easiest to read posts I have seen from someone in a long time. No fancy confusing math, no big fancy words and no nonsense. Straight forward and you progress through the information to the conclusion smoothly. I really love that acronym , very “smart” of you .
Thank you @chrisistace:disqus – that means a lot & is kind of you to say.
It’s easy to say when it’s the truth
We chose the third option- to thrive on two half incomes. It seemed more fair and now we both have time to play.
That’s a great option! Can’t wait to increase my play time
Always great & inspiring to hear of other “make it” on a single income. I think the key word is “sacrifice” and it’s sometimes more than just material sense. My parents moved away from home to support our family, I did (then moved back to my wife’s), and you did too.
I just read a book about this last week and how one reason American social mobility is declining is because fewer families are picking up and moving to the jobs.
I get the social mobility thing – it’s really hard to be away from family at times. I often wished we lived closer, but we’re chasing opportunity now so that we can live the life we want later.
Thankfully most of us have the option to move or stay put. It’s a tough decision that I never wish on anybody.
One thing I was told when I was getting ready to graduate school was that you can always move back home. My big thing was to sacrifice early so I could have the freedom & options to care for my parents in their older years if & when that time comes.
Ty, it was great to hear your setup for success story. I think its really neat that you and your wife married young. My wife and I did the same.. though you are a few years ahead of us chronologically. Thanks for the encouragement!
Thanks, Wes! Nobody’s every been so polite when calling me old 😛
Love this Ty! I can relate in several ways (less the million dollar home and Benz lol). My wife and I married young, 23 (me) and 19. We have 3 kids around the same age as yours, and have always been a one income family. We’ve certainly made huge sacrifices lifestyle wise, but we wouldn’t change a thing. For us, it was so important for my wife to be at there when the kids get home from school, and in the summers as well. Even though our kids are now older, we feel like it’s just as important as ever. I completely understand that this isn’t a reality for all families (I grew up as a latch key kid in a single parent home), but I also think that there are many families who could make it work, but need help understanding how to make it work. This post lays things out very clearly!
I was a latchkey kid as well! And I’m right there with you – the older our kids get, the more thankful I am that we’ve got a parent that can be there 100% of the time. Thanks for the kind words!
Awesome post Ty! We are also thriving on a single income (family of 5) and I think you hit the major things that have made us able to get there too.
Thanks, Chris! Great to lean about another big family personal finance blogger!
Great post, Ty! You have given very practical guidance. In our home, both of us work and we are thankful for our jobs. I enjoy what I do for a living. We are always looking for ways to cut home operating expenses down and increase our savings rate.
Being able to live off of one income and save 100% of a second income would be fantastic! It would definitely speed up my countdown to FI!
We have lived off one income for about 5 of our 9 years of marriage just fine. My husband is enlisted in the US military so we do not make a considerable amount but have always lived within our means and try to save and invest for our futures as well as our kids. We are looking to become a one car family when we move stateside in August to try and save more. I actually found that we save more on one income then we did 2! 🙂
It’s not what you make, it’s what you keep! I know what you mean about saving more on one income than two. It’s easy to feel like you can live large when you’ve got two paychecks! I’ll be sure to stop by and check out your site: https://payingyourselffirst.wordpress.com/
There are people who can’t get ahead because they spend too much, and there are people who can’t get ahead because they don’t make enough. There are people who think they don’t make enough, but actually just spend too much, but there are also people who don’t make enough to decently raise a family on one income, much less save for (early) retirement while doing so.
Agree with everything you’ve said @ruthcurcuru:disqus. I’ve been in every single situation you’ve just described.
Thanks Ty, an inspiring post and the first one I’ve come across! Appreciate you sharing your wisdom, approach and outlook. Looking forward to reading more. Enjoy your day. Many thanks, Kirsten from New Zealand.
Cheers, Kristen! I appreciate the kind words!
Thanks for sharing your story. You have made huge changes that many are just unwilling to make, and it’s obviously paying off. We have never made such a huge change, but we determined from the beginning (also married at 20 & 22 while still in college) to live off one income. This made for an easy transition for me staying home with the kids since we’d purchased our home with a one-income budget in mind. It also made us possible to pay off our debt, even on one income. It really is possible for thrive on one income–thanks for sharing how to make it happen!
Your determination to live off one income is awesome! That’s why you’ve never had to make such huge changes. I was simply cleaning up messes I’d made – you never made them. Well done! “an ounce of prevention is worth a pound of cure”
This is super inspiring, Ty. We are 3 years into being a one-income household and are still working on the thriving aspect. Thank you for proving it can be done.
Thanks, @codydollarhabits:disqus It can take time to thrive, but while you’re still early in your journey the best thing you can do is set yourself up for success. Best of luck!
Thank you!
“There are only two ways that I know of for someone to get rich quick. One way involves breaking the law, the other involves breaking the laws of probability. Don’t waste your time chasing either option.”
There are so many gems in this post I want to read it twice. But that’s the one that sticks with me the most!
Great post Ty. Couldn’t agree more with everything you said!
This is an AMAZING post!
I am happy I stumbled upon your blog because if this is the quality of content you produce, then I will be back often!
The point I love the most that you raise is “follow opportunity, not passion.” Yes…That may sound cold hearted, but it is the honest truth. The truth is that it is getting expensive to be an American. Rising costs in living, healthcare, college, etc., has created a different financial climate that new age workers need to understand. You can very quickly get behind the financial 8 ball in this country if you only accept working in the field that is your sole passion. Yes it is important to like your work, but if you want to 1 day be free financially then you will have to chase opportunity. Opportunity gets you paid and furthers your goal towards financial independence. Find a way to blend the 2 by doing your passions on the side as hobbies, while you are chasing opportunities that will provide you with more financial stability.
Awesome post!
We also have 4 kids and have always used 1 income. After 17 years of marriage, my wife started teaching and I left my job to start a company. Her income covers about 75% of our needs, so I can concentrate on reinvesting in my business. If we lived off dual incomes the past 17 years, I could never have sacrificed to start my business.
People that set themselves up for success usually find it. Nice work, Cory!
Such an amazing post , your all points are very informative about thriving on a single income , but ” Be Patience ” this point is great for everyone to survive in every field
Thank you for sharing
Thanks for the post. It is inspiring. One way to thrive is reduce expectation and be content. If a million dollars will not make me happy … 2 million will not either.
Could you share more numbers? Seattle is super expensive. If you are not comfortable sharing numbers that’s okay. At least some %. How are you really able to meet your expenses? Do you have additional passive income stream? e.g. dividends.
“Follow opportunity, not passion” is excellent advice. I find it very frustrating when people give the advice to “follow your dreams” or “if you dream it, you can do it” because living your ultimate dream just isn’t normally realistic. Sadly.
Especially when people of influence say it–like actors and athletes. “If you try hard enough, you can be just like me!”
I think you have a better chance at being struck by lightning than becoming a famous movie star. Just ask all the homeless people in Los Angeles.
I know I already commented on this, but I really cannot say enough about the flexibility piece. PLUS, the idea that it takes sacrifice but that the sacrifice doesn’t have to last forever.