I was 20 weeks pregnant when I decided to leave my job at a well-respected national non-profit.
It was supposed to be my dream job, but it was also extremely stressful and I couldn’t imagine keeping up my excessive hours with a newborn in tow. And if I took the six-week paid maternity leave my company offered but then decided not to return or to scale back my hours, I'd have to pay it all back — not something I was willing to do.
But while I was ready to put in my notice that day, my husband was not sold on the idea. After all, we never intended to become a one-income family when we decided to get pregnant, so this would be a drastic change. But when it became clear to me how much happier I would be leaving my job, I decided to get serious about doing whatever it would take to make it happen.
So over the next several weeks my husband and I figured out what losing my income would really look like. We adjusted — and then re-adjusted — our budget and came up with a plan to live on one income while growing our family.
Here’s how we made the change to one income work for us.
My husband values financial security over most everything else, while I’m more willing to take a financial risk to improve my quality of life. Our spending habits differ too: I’ve been known to go over budget for a purchase that gives me joy, whereas my husband is very disciplined with what he spends.
My husband recognized how stressful my job was and he agreed that my excessive hours weren’t a good fit for our family, but the thought of losing my income was scary for both of us. So while I would have liked to leave my job sooner, we agreed that I would stay until the baby was born. This gave us time to really evaluate our spending habits and assess where we could cut our budget. It also gave me some time to prove to my husband — and myself — that I had the discipline to rein in my spending.
We Asked for Help
My income at the time was roughly $2,000 a month and my husband’s was around $3,000. With this, we were able to cover all of our monthly expenses, add to our savings and still have some “fun money” left over.
To prepare for our decreased income, we first cut any expense that wasn’t a necessity, like our gym membership, cable, Netflix and “fun money.” Next, we hit pause on our savings and my husband also reduced his 401(k) contribution from 10% of his paycheck to 8%, which gave us a little more cash flow.
After all that, we had just one monthly payment we couldn’t cover — my $300 student loan. We had a few thousand dollars in savings, but we knew that would only sustain us for so long. So, like many millennials, we turned to our parents. This was especially tough for my husband, who prides himself on his financial stability, but since I planned to go back to work eventually, we knew it would only be temporary.
We were lucky that our parents were in a position to help us, and they agreed to make my student loan payment until we could cover it again. With their gracious assistance, and our slimmed down budget, we would just barely break even every month.
We Were Honest
Occasional splurges were tough for me to give up, but something I could live with. However, adjusting the money I spent socially was harder. I didn’t want to give up time with our friends, but all “fun” purchases — whether things or experiences — were off the table.
So we got creative and honest about our social lives. When friends asked to go out to dinner or grab drinks, we explained our financial situation and instead suggested an activity that didn’t cost us, like a home-cooked meal or hanging out at a nearby park. Luckily, they understood where we were coming from and almost always took us up on the cheaper offer.
Returning to Two Incomes
We lived on this bare-bones budget for almost a year. I left my job a week before our son was born, and when he was nine months old I found a new job (with better hours and flexibility) and went back to work. With this extra income, our finances have more or less gone back to how they were pre-baby.
I’m incredibly grateful for that time with our newborn — something I know not all new parents are financially able to do — and to be rid of a stressful work environment, but there’s no denying that living on almost half our normal income was a struggle.
Knowing that it was a temporary situation, though, helped us stay on track. And while we don’t plan on doing it again anytime soon, it’s nice to know that — should we be faced with another difficult financial situation in the future — we are capable of cutting our expenses to the bare minimum and making it work.