How to Raise a Family on Less Than Two Incomes The Complete Guide to Managing Your Money Better So You Can Spend More Time With Your Kids

Part One CHAPTER 1 Get a Grip on Your Spending If you don't know how much money you spend or what you spend it on, you're not ready to hop off the two-income treadmill. You've got to know where your money goes if you want to start living on less without drowning in debt. Sure, tracking expenditures is tedious, but I guarantee it'll pay off big. When I got a handle on my spending, I realized that my husband and I were together blowing about $45 a day in cash! That's more than it would cost us to eat out every night. What were we spending that money on? The list was long, so I'll name just three little indulgences that'll be familiar to many two-income couples. My lunches, because I was too busy every evening to even think about brown bagging it the next day. Taxi fares, so my husband and I could work past 5 p.m. and still rush home before we had to start paying our nanny overtime. Saturday lunches out, because we often spent the entire day doing errands that we didn't have time for during the work week. The parents I surveyed spent lots of money on other types of goods and services when they tried to live the two-income lifestyle. Do any of their stories ring a bell for you? Nancy Krzywicki, an ex-magazine editor who now freelances part time so she can spend more time with her five-year-old daughter, recalls dropping about $40 a month on dry cleaning when she worked in Manhattan. She used to spend $150 getting her hair cut and colored every five weeks. Now she waits at least eight weeks between salon visits, and saves about $500 a year. "I've also given up manicures," she says. "I never liked them but felt I had to have my nails done when I worked in a full-time office job." Before they had their first child two years ago, April and Ben Orseck were so busy working that they ate out four times a week. Now that April stays home with their two children, the Orsecks go out to dinner only once a month. April even packs a brown bag lunch for Ben daily. Yvonne Lowry quit teaching after the third of her four children was born. She and her husband Tom, a packaging designer, dipped into their savings to pay off their car loan. They also let their cleaning woman go and, of course, stopped sending their kids to day care. With hardly any effort, they slashed their expenses by $1,300 a month. When Amanda and Neil Pinder both worked for her father's computer consulting company and had one son, careful shopping wasn't a priority. Then came triplets, and suddenly the Pinders had four kids under age two. Says Amanda, who's now a stay-at-home mom: "When I worked and had just one son, he had an outfit for every occasion. Now all four kids have a fairly sparse wardrobe." Amanda also used to spend more on each item, like the $90 winter coat she had to return because its zipper jammed. "Now I wouldn't pay more than $30 for a kid's coat," she says. What will you find out by using the worksheet in this chapter to track your spending? You'll discover the following five crucial bits of information: 1. You'll learn how much money you'll save if you quit your job and simply cut out work-related expenses. Just think'you'll be able to kiss child care and commuting costs good-bye. 2. You'll see how much you spend on discretionary items, and you can plan to trim those expenditures through sheer willpower. If you eat out two or three times a week, for example, you can vow to reacquaint yourself with your kitchen. You might also cut back on the number of lattes you buy each week. 3. You'll see how much you spend on necessities like groceries, insurance, and health care. Having a handy record of these expenditures will help you figure out which ones you can cut'and by how much. 4. You'll find out what you do with (almost) all of the cash you pull out of automatic teller mTopolnicki, Denise M. is the author of 'How to Raise a Family on Less Than Two Incomes The Complete Guide to Managing Your Money Better So You Can Spend More Time With Your Kids' with ISBN 9780767905657 and ISBN 0767905652.