This was my intro post for the now defunct Moneyville blog, where I wrote a column twice per week for 2 years. The blog was folded into The Star’s personal finance section in January, where I continue to write a bi-weekly column. Enjoy.
As a thirty-something, single-income, two-child family, we are faced with plenty of financial challenges. To further complicate things, my wife was diagnosed with Multiple Sclerosis a few years ago, which meant making sacrifices in order to live a healthier and more balanced lifestyle.
So, soon after our first child was born in 2009, my wife left her job as a medical office administrator to stay at home. This reduced our household income by a quarter, so we estimated what our income and expenses would be for the next year and then had a close look at the numbers.
We figured that in order to live on one income and make this work we had to come up with $1,250 a month in savings. Here’s how we went about it:
- The bulk of our savings came from not having to put our daughter in daycare. The cost of full time care in Lethbridge, Alta., where we live was $750 per month. We considered ourselves lucky that we didn’t live in Toronto, where according to Toronto Children’s Services the average cost of full time care for an infant was about $1,400 a month.
- We reduced car-related expenses by $150 per month by dropping the collision coverage on our 12-year old Hyundai and saving on gas by using it only when necessary.
- We saved another $100 a month by not spending that amount on my wife’s work clothes and on lunches out with co-workers.
- We trimmed $250 a month from our grocery bill by planning our meals in advance, buying groceries in bulk, and cooking at home every night.
We could now claim the $10,822 spousal amount; a tax credit that can be transferred to the higher earning spouse if the lower earning spouse has little to no income, and the Universal Child Care Benefit of $1,200 a year per child. This put about $250 per month in our pocket.
We have found that living on one income really isn’t as tough as we thought. We might get by with a little less, but we live comfortably. A year after our first child was born, I started this personal finance blog with my mom and I’ve been able to supplement our income through that and some freelance writing.
Related: Ways To Earn More Money
I think the sort of financial issues we face are fairly common, but I learned that in order to reach your goals you need to develop a plan, especially as a young family. With the right plan in place it becomes easier to balance your day-to-day spending with your savings goals.