Living on One Income

Credit cards are very useful, only if you know how to handle them.

One big plus is its convenience. You can have big purchases and avail of the bank's installment plans, or you can even have cash advances in case of emergencies. But then, if you're not careful, one big purchase can lead to another, and then before you know it, things are getting out of control.

But actually, you can either make it work for you or against you, and everything will depend on how you handle it through your spending habits.

In my household, ever since we became a one-income family, my husband and I have vowed that we will no longer let these credit cards to take over our lives. So, now, we've taken the following steps in trying to get hold of our spending habits:

(1) We only charge what we can afford to pay.
(2) We pay our credit card bill on time.
(3) We always keep the receipts and make sure that we compare them with the actual charges in our card's statement of accounts.

These simples steps go a long way in helping us keep track of our expenses.

Being in a one-income family, a Budget is a must. I have printed a spreadsheet of our budget and posted it in our bedroom wall so that even the kids can see it. Although many families may view a budget as unnecessary, it is really vital if you want to know where your money is going. However, a budget is not just for show or for paper, like what happens sometimes in my household. A budget is more than a written record of the money flowing in and out of your household. It is a financial tool that can help you save money, change your bad spending habits, or to help your family in times of emergencies.

Where did all your money go?
You need to keep track of all your daily expenses by writing it down in a small notebook which you can carry around with you. It's an eye-opener, believe me! Do this for at least one month and write down everything, and I mean, everything, that you spend money on, even the littlest thing or amount.

This will help you trace your spending habits, good or bad. Tracking your expenses is only the first part. If you're spending less than what you're earning, you're on the right track. If you're spending way beyond what you're earning, then it's time for a financial makeover.

Lastly, if you want your budget to work, let the family into it. In my case, my husband and I have discussed this with our kids so that they're aware of where we stand financially. More than discipline and motivation, it is communication that makes a family budget successful. It's going to be hard for you to save and save while everybody else wants to spend and spend.

Since living in a one-income family, we had learned to cut down on a lot of things. We have also identified a lot of areas in which to minimize our spending. I have listed most of them here:

• I always carry snacks when i go to work. And i don't eat out. I also take advantage of the budget meal offered to staff in our office, which is really cheap but a complete meal already.

• To save on gas, i just commute to work. The heavy traffic that i encounter everyday can take its toll on our budget for gasoline, so, this is where i am very careful.

• As in my previous post, i have identified switching from branded products to store brand products as one of the best ways to save on grocery expenses. The quality of these products are now at par with the name-brand products.I even know for a fact that some grocery stores get their products from reputable companies, and stamp them with their own brand, thus, making it cheaper, because these companies don't need to spend on advertising.

• We are also extra careful on how we use the electricity in the house. The kids are trained to always turn off the lights which are not in use. We have also minimized the use of our airconditioner, although of course, sometimes when the heat is unbearable, we couldn't sacrifice the health of our kids for this.

• We have stopped using the rice cooker and just cook our rice in the range. This saved us a lot because hot plates consume a lot of electricity.

• We don't have a microwave oven in the house, because, again, this can eat up a lot of our electric bill.