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Child care is expensive, and sometimes the majority of the check goes specifically to that. Or you simply want to stay home with your baby and soak up their childhood! Whatever brings you here today, I’m here to help you make it possible to be a stay-at-home mom even during this economy!
It can feel daunting to even start, and you may already be telling yourself it’s not possible… but you truly won’t know until you know your financial health. Meaning how much do you owe, how much is in savings, how much of your income a month is going out, etc. And, if you have a spouse, this includes them, too.
Did I stress you out with all that? Don’t worry, every step will be clear for you to take steps at your own pace. It’s possible for your family to live on one income, even if it takes time to make the changes necessary.
So, here are the steps to budget on one income even when money is tight:
How to Look at Your Finances Without Stress
Before we even think about budgeting, the first step is to understand where you are with your finances. The first step is awareness.
You are going to start by:
- Listing what’s coming in (your household income)
- Listing what’s going out (bills, spending, everything)
If you are unsure of what’s going out, start tracking on a piece of paper or check bank statements. Once you have a clear understanding of where your money is being spent, continue to the next step.
I know this feels uncomfortable, especially if you’ve been avoiding it. But once you face it head-on, it becomes easier and easier to review bank statements. Especially because you will build confidence and set a budgeting system that works for you.
It won’t always be this uncomfortable, I promise!
Know Your Numbers: How to Track Your Income and Expenses (Keep It Simple)
I remember someone asking me in my Instagram DMs if a specific Etsy spreadsheet was ok for them to start budgeting. And honestly, you don’t need spreadsheets or anything fancy at all.
When I started budgeting for the first time, I started on my planner, and guess what? That’s where I built the confidence to budget and then upgraded to a spreadsheet.
Here is what my simple budget looked like, and this is how you can start yours, too!
Start tracking your numbers in these two categories:
What’s Coming In
- Your income
- Your partner’s income
- Any side income (if you both have any)
What’s Going Out
- Rent or mortgage
- Utilities
- Groceries
- Gas
- Insurance
- Baby/kid expenses
- Subscriptions
That’s it. Let’s keep it very simple. Don’t think about it and move on to the next step. We’re not overcomplicating this.
Prioritize Essential Expenses First in Your Budget
No matter what, protect your basics at all costs!
What are your essential expenses?
- Housing
- Food
- Utilities
- Transportation
Which means they are your non-negotiables. And then everything else can be flexible. This way, your family always has the necessities at all times.
How to Create a Simple Budget on One Income
YAY! Congrats on making it to this step! It is time to start giving your money direction.
Think about your budget in 4 simple categories:
- List your bills: Amount and due date (rent, utilities, insurance)
- List your spending (groceries, gas, household items)
- List your savings (even if it’s small)
- List your debt: Amount, due date, interest, and total amount owed (if you have it)
That’s it.
You know why creating a budget is stressful? There is shame.
When you list your debt, you start to think about why you are in this hole and how you got into it. Money is emotional.
If this is you, I want you to read, Why you should be thankful for your debt, here.
Another reason why this is stressful is that you start to think there is a magic formula that you do not know about. Trust me, I was you. And after so many years helping my clients with their budgets and being a money expert, there is NO special formula. You just have to get through it.
It is simple.
But no one ever taught us that money can be simple, and THAT part is hard to understand.
I just want to validate that what you feel is normal and okay. It does not mean you cannot budget; it does not mean anything about money.
With that being said, let’s continue to make your simple budget:
Step 1: How much is your household income?
Step 2: Subtract your essentials
Step 3: Subtract everything that is going out.
Step 4: Subtract how much you want to save per paycheck
Step 5: Subtract your debt
If you have money left over, do you want to put it into savings or pay off debt? Or do you have a different category in mind? Perhaps you want to go on a walk and buy yourself coffee more often with your little bundle of joy, then it can go towards something fun.
Here is why adding fun money to your budget is also very important in the long term.
If your goal is to pay off debt faster, so being a stay-at-home mom is easier, then send it to debt.
Here are other budget categories to include, in case you forgot a few.
How to Reduce Spending Without Feeling Restricted
This is key to spending in alignment. This step does not mean:
- cutting everything
- saying no to everything
- making life miserable
The more you say “No” to things you are not aligned with, the more “Yes” you get to say to the things you want.
Here is how you can start reducing spending without feeling restricted:
- Cancel what you don’t use, like memberships and subscriptions
- Reduce what doesn’t matter
- Keep what brings you joy
Notice that I am not saying to simply spend less. You need to make room for the items and activities that bring you joy! This balance will help you budget as a stay-at-home mom without stress.
How to Find Extra Money in Your Budget
The majority of us have money leaking out of our budgets! Trust me when I say you might be surprised by how much extra money you can find in your budget.
Even if you think, “I don’t have extra money.”
This is how you can find extra money:
- Cancel subscriptions you forgot about
- Work on your grocery habits (this is a big one)
- Small impulse purchases
- Negotiate bills yearly (be willing to jump ship)
The idea in this step is that you avoid money leaks, which can help your household reach its financial goals much faster. Even freeing up $50–$100/month can change everything!
How to Plan for Irregular Expenses in Your Budget
Budgeting as a stay-at-home mom with one income is not impossible, but it does require planning. Why, you may ask? This is usually where budgets fall apart because irregular expenses can throw off your budget groove and financial goals. Depending on how much that expense is, it can be difficult to get back on track.
Here are a few irregular expenses to not forget to add to your budget:
- Holidays
- Birthdays
- Car repairs
- Baby needs
- Insurance renewal
Think of all the expenses that happen annually or quarterly. These are the expenses that are easy to forget. Once you know they are coming up, you can plan for them rather than be surprised.
When you plan ahead, you will feel in control of your finances rather than living in financial chaos.
Here are a few reasons why your credit card should not be your emergency fund.
How to Build a Small Emergency Fund on One Income
I know I said the tips above are important, but truly, you can’t skip this part. And, you don’t need thousands saved right away. But you do need savings, because life is not linear, and you will experience bumps in the road. You need savings to cover any emergency that arises.
The downside of not having an emergency fund, A.K.A savings, is that you will accrue debt, because it is likely you will need to rely on your credit cards to cover the expense.
To avoid accruing debt, start saving small quantities:
- $25
- $50
- $100
Do not go all in; start saving large amounts of money, like $500 at a time, and then use your savings to cover your regular expenses. The idea here is that you build the habit of savings, and you won’t feel like everything is falling apart financially.
You do not want to miss why you need a F*ck You Fund, and how to start one ASAP.
How to Automate Your Bills and Savings
This part may seem scary because you want to have control of every bill. I know I did, but once I automated all of my bills, I had less stress and wasn’t thinking about money 24/7. The less you have to think about money, the better.
What to automate to make your life easier?:
- Bills
- Savings transfers
Automating will help you:
- Stay consistent
- Reduce stress
- Avoid late fees
The Less thinking you have to do, the more peace you will experience. Also, I hate to think about it this way, but imagine if you receive bad news and you are processing so much emotionally, having your bills automated, you do not have to worry about them, you can just focus on being present. Maybe you will be across the world, and you don’t have to put your vacation on hold to pay bills. I really hope you give it a try!
How to Include Guilt-Free Spending in Your Budget
Yes, fun money matters!
Let me say this again: Yes, fun money matters even on ONE income!
It’s not realistic to always eat at home and never go out and have fun and make memories. For your budget to be successful, you need to allocate money for fun. You know more than anyone that as a stay-at-home, you want to be out with the kids, and that includes snacks, ice cream, literally anything to make the outing better.
Your budget should include a small amount that won’t take away from bills and financial goals but still lets you enjoy an outing.
Think coffee, snacks, and zoo admission, etc.
Because if your budget feels restrictive, you won’t stick to it.
And we’re building something that lasts.
Your Next Steps to Take Control of Your Money
You don’t need to fix everything today.
Just start here:
- Look at your numbers
- Create a simple plan
- Adjust as you go
That’s it.
No pressure. No perfection. You are building your family’s financial foundation here, so take your time figuring out how to be a stay-at-home on one income. It is completely possible for your family!
I want to applaud you for taking the time to figure it out and make financially aware decisions because this is how you can go from:
👉 stressed and guessing
to
👉 clear, confident, and in control
I am cheering you on!
