How to Survive on One Salary

Squeaking by on one paycheck when you’re used to having two can be a lifestyle buzzkill. But not if you play your cash cards right! Here’s how.
1. Suss Out Your Finances

Sitting down together to hammer out your new financial status? So not fun. But it’s time to get crackin’ on it, unless you want to wake up to a mountain of debt next month.
Evaluate your inflow/outflow. Now that you’re only getting one paycheck, you need to really analyze what you have versus what you spend so you can recast your budget to fit your new (lower) income. You may be taking in a couple of thousand dollars less a month and not realize that your collective spending habits haven’t changed (oops, $100 highlights and ball game tickets). Track your cash flow with our debt calculator.
Make your cuts count. Aim to stay within the same ratio of saving to spending that you had before one of you became unemployed. This is especially key if you were spending practically as much as you were pulling in with both of your salaries. If you’re making 25-percent less, then your expenses should drop 25 percent. Since some expenses are fixed, like mortgage and car payments, chip away at things like eating out, cable, and clothes.
Evaluate insurance coverage. If one of you lost your health insurance, get covered under your spouse’s policy. A job change or loss is considered a Qualifying Event, which means you can sign up at any time. Or check out COBRA ( If you or your spouse was laid off after last September 1 and your combined income is less than $250,000 for the year, you’re only required to pay 35 percent of the COBRA premium for the first nine months of your coverage — the government covers the rest.
2. Work That New Budget
Pinching your pennies isn’t fun, but you’ve gotta get on board with your new spending plan pronto. Hey, it’s a lot like ripping off a Band-Aid…the faster you do it, the less painful it’ll be in the long run. Still hurtin’? Keep in mind: This situation is temporary!
Adjust your accounts. If you were the one in charge of paying the mortgage or rent while he took care of the car payments and insurance, you’ll have to rethink how you divvy up bills. Why? So you don’t start bouncing checks or paying overdraft fees! Keep it simple by designating which account you’ll both be writing checks from. Switch all of your automatic deposits and debits to the checking account you plan to use; reserve the savings account for your non-monthly expenses, like tax payments.
Pass on plastic. Paying with cash actually triggers negative feelings in an area of the brain called the insula, which means you spend less when you’re forking over your hard-earned greenbacks rather your credit cards. Can’t control yourself? Just drop all of your cards into a container full of water and stick it in the freezer. Next time you’re tempted to whip out the plastic, the urge may be gone by the time they’ve defrosted.
3. Keep Saving (even if you think you can’t)

Stop saving for the future and you’ll miss out on long-term gains — or find yourself in a tighter spot if you need emergency dough.
Continue funding retirement accounts. Bumming over lower returns on your 401(k) or IRA statement and wondering why you should put cash toward something you won’t see for 30 years? As tempting as it is to quit funding retirement accounts, the nonworking spouse should contribute a small percentage of your monthly budget, while the employed one should put in enough to get an employer match (free money!). According to research, you’ll recoup today’s low returns over time.
Don’t touch emergency money. You’ll need that cash to back you up should the employed spouse lose their job. Considering tapping it to pay off a big bill? A crucial car repair is okay; a new kitchen appliance isn’t.
4. Work as a Cash-Stashing Team

How will you stick to your new plan if you aren’t on the same page? You need to start communicating more about money, period.
Play fair. Avoid “my money/your money” fights by setting an amount you can both spend each month, because even an out-of-work spouse will have expenses. For bigger purchases, you’ve gotta compromise — the breadwinner can’t always get their way.
Do monthly checkups. Sit down together once a month and review your new budget. It’s not just about recording a number, but assessing if that number’s realistic and, if not, how to make up the difference. So, say that you budget $100 for groceries and spend $125, but also budget $100 for dining out and only spend $75. That doesn’t give you a freebie to say, “Hey, let’s get pizza…we have an extra $25!” Sorry, but that surplus needs to be funneled back to your bloated grocery tab. Next month, you’ll know that you have to modify your budget so you can allot more for the supermarket and less for restaurants.
Separate needs from wants. Yeah, you’re dying for that Mexican vacay or deck reno, but do you really need it? Remember that the sacrifice is short-term; you can save up for those perks once you’re more financially stable with our savings calculator.