When people find out I'm a stay-at-home mom, many remind me how lucky I am because "it's hard to live on one income nowadays." They're right, it is hard, but it's not impossible.
Without divulging our bank balance, I want to share how my husband and I are able to swing it because I'm sure some of you would like to stay home but can't figure out how to make it on one income. Even if you love your job and never plan to quit, my story could help your family find more money in your monthly budget. And who doesn't need more money in this economy?
When I became pregnant with our first child, my husband and I thought we were in good financial shape. No unusual debts, just car payments, a few nagging student loans and a couple hundred dollars on a credit card. We even had a decent savings account building up. I was working as a TV news reporter in Knoxville, Tenn., and my husband was gaining valuable experience in his first real sales job.
We lived in a tiny, yet glorious, one-bedroom apartment that overlooked our apartment complex's pool, which was open year-round because it hardly ever snowed. We were thrilled about the pool, considering we'd moved there from Cleveland, Ohio!
We had everything we needed - a couch, two chairs, a queen-size bed, (I'm embarrassed to admit we had milk crates as bedside tables) and a hand-me-down table and chairs. Life was simple and good.
Funny how the simplest times in marriage (i.e., when we had the least money) often seem the most romantic, isn't it? It's also funny how a positive pregnancy test can make you start thinking very differently about money (and romance for that matter).
Early in my pregnancy, we realized that, although we were "doing well," we needed my salary to make ends meet. Around the same time, we started listening to a financial guru on the radio named Dave Ramsey. Dave taught us that we weren't doing as well as we thought. We were in debt. "Car payments are debt," he said. We never thought of car payments as debt. Doesn't everyone have car payments? We wondered.
We'd adopted the common American mindset that car payments, student loans and credit card balances were just part of life - like blinking and breathing. We never thought we could have a car without a payment. But when we truly examined it, the monthly payments were killing us. As Dave says, "The borrower is servant to the lender."
So here's what we did: We saved $1,000 for an emergency fund. Then every nickel after paying our rent, utilities and food went toward paying off the debt. We used our small savings - except for the $1,000 - to pay off debts, too. We started with the smallest debt. Once it was paid, we attacked the next smallest and so on until we were truly debt free. Dave calls it the debt snowball. Before our son was born, we had successfully tackled nearly $25,000 in debt.
And guess what? Slowly, we got rid of our monthly obligations.
We had more money at the end of every month. I could quit and stay home with our baby!
We've continued following Dave's plan, and we've never had another car payment. That's right, we have bought every car with cash.
We were able to save more than 20 percent for a down payment on a house and today all we owe is our mortgage.
Has it been easy?
No way! I am just like everyone else, I love stuff! I love clothes and shoes and decorating my house, and now that I have a baby girl, I drool over pink.
But I love being out of debt more. I love staying home with my children more. I love feeling financially free more. I love not being servant to the lender more.
~ Shasta Clark is a St. Clairsville native who lives in Chagrin Falls, Ohio, with her husband, two sons and daughter. Her e-mail address is email@example.com.