Cutting Expenses To Focus On What You Really Want

I just came across the story of the house that two incomes built, and although it’s a couple years old, it’s still well worth sharing.  It continues with part 2, and the photographs are what make it particularly interesting, along with the description of the personal struggle involved with deciding whether to go back to work after the birth of a child.

Some parents would rather go back to work, and they feel more fulfilled with both a career and a child than they would staying home full time.  And the opposite side of that is the parents who know that they want to stay home and have planned for it long before their first child arrives.  In the middle are the parents who aren’t sure.  And the ones who would stay home with their kids if money were no object.

The money issue is tricky.  If you’re used to living on two incomes and have expanded your lifestyle to use up all or most of those two incomes, the option to have a parent stay home with a child will require more than just a letter of resignation.  It might mean getting rid of a car, cutting back on shopping trips and vacations, or even moving to a less expensive home.

I’m very fortunate to be in a situation where my husband and I both work from home.  We spent five years growing our business before we had our son, and purposely structured it so that we are both home most of the time.  The most important thing we’ve done though is to not inflate our lifestyle as our income grew over the years.  As a result, a good chunk of our income goes into savings and extra mortgage payments.  The future is never certain, but if our business were to stop making money, we could continue our current lifestyle on less than an average single income (obviously we wouldn’t be able to continue saving and paying off the mortgage at our current rate, but we’d be able to get by).  We could have bought a more expensive house or upgraded our cars, but that would have increased our monthly expenses and put us in a more precarious situation in terms of needing a higher income just to get by.

This isn’t about whether parents should stay home with their kids.  That’s a decision that has to be made by each family, and is a highly personal one.  But if you focus on keeping your expenses (especially for the biggies – housing and transportation) as low as possible, you give yourself more options than you have if you spend everything each month.

I wanted to share the story of the house that two incomes built because I find it inspiring to see people making drastic changes in their lives in order to focus on what they want most.  Obviously this sort of thing is not limited to staying home with children.  It could be about starting your own business or retiring early or setting out to travel the world.  What matters is that we actively choose our path and make decisions with our goals in mind, rather than falling victim to advertising and debt.

Would you move to a much less expensive home/area in order to be able to work part time, stay home with a child, focus on volunteering, travel, etc?

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  1. April says

    You were very inspirational to me in that regard. I remember when you posted about your choice to stay at home, and I thought to myself that if/when I have a baby, I want that choice, too.

    It seemed like the two biggest factors were living below your means and having a job you could do from home–two things I started to work on. I now work from home, and while I’m not nearly as frugal as you, I’m 100 times more frugal than I used to be. I’m getting tired of stuff–of owning it or even wanting it–so slowly but surely, my husband and I are saving more and more of our income.

    Side note–I’m curious if you could post more about your retirement investments. I seem to remember you choosing investments that we’re more in line with your belief systems, and this is something that’s really important to me, as well. I don’t want to shop at the farmer’s market each week only to invest in Monsanto unknowingly. Think you could post an update on that sometime?

  2. Tiffany says

    Love this post, and the linked story. When making the decision on how much of our pre-approved mortgage amount (which made us laugh hysterically) to spend, we thought long and hard about future desires. I want to stay home with the kids we’ll have in a few years, and he wants the same. We bought a house that we can afford now, while simultaneously paying off student loans and automobiles, with the idea that we will aggressively pay down those debts so that within 1.5 years we will be debt-free, except for the mortgage. We also figured out that my fiancee can work from home two days a week, and I can do two 12 hour nursing shifts on those days, and we will still have enough money to pay the mortgage early and save. YAY!

    This long term plan means that currently we are not:

    buying furniture or decorating – we are picking and choosing home “improvements” with MUCH thought and deliberation
    having an expensive wedding. Our wedding will be very cheap compared to todays standards
    shopping (my vice)
    eating out (save for special occassions)

    and in general spending on things that don’t support our long term priorities. I feel so lucky to have a partner who will work as hard as I will so that I can eventually STOP working (in the 9-5 sense) and stay home with out little bambinos :)

  3. Cathy says

    I just found your blog and absolutely LOVE it!!! Thank you for sharing your wisdom and heart with us.
    I look forward to looking over your past writings and the ones to come.
    Blessings to you,

  4. Pippi says

    Great thought-provoking post! I enjoyed the story you linked to, as well. My husband and I constantly have this conversation. We love our neighborhood. We don’t want to leave our community with its library and community center walking distance from our home, the life on the street, bikeability, small local grocery stores, etc. But the cost of a 3 bedroom townhouse here is half a million dollars at least. Currently we live in a 2 bedroom co-op suite and try to balance saving as much as we can towards a down payment and actually living our lives. Should we leave our neighborhood? Should we leave our province entirely and start fresh in a totally new city? Should we stay and build equity by living in a tiny two bedroom condo with two children? Should we give up on home ownership and move across the hall to a 3 bedroom suite in our co-op? We keep going around in circles…

  5. Amanda says

    Thanks for this post. I can’t answer your question-I don’t know what I’d do if I were living in a fancy house. Maybe I wouldn’t want to give it up. Fortunately, my husband and I live in a small home in a moderately priced neighborhood. We’ve been married almost 3 years; he’s lived here 10 years. I haven’t worked full time since maybe June 09 (not sure of dates now). The first couple years of our marriage we worked at paying off debt. It was minor, under $10,000. We sold his car (at a loss) and went with one car for awhile and after that I got a $1,200 car with 36,000 miles! Now I can work part-time seasonal (less than 3 mos a year!). Starting in April my husband went down to 3 days a week at work-just enough to cover necessities. We share in volunteer Bible teaching work for an average of 70 hours a month each. What a happy life! I’m so glad to spend time with him. I suggest others think about doing this instead of working full time, even if they aren’t planning on having kids. Now we’re talking about becoming a foster family, either for babies or an emergency home.

  6. says

    In a way you could say we haven’t moved in order to do that. We could have bought a much more expensive house than we did, and now that we have kids, we sometimes think about whether we should move to a larger house. But really we have enough space, we just need to use it better. I have to admit to “home envy” sometimes when visiting friends for playdates, but then I think about needing to furnish it, clean it, and pay for it and I remain happy with what we have.

  7. says

    Yes! My first advice to anyone buying a house is don’t buy more than you could afford on one salary. We live in a 2 bedroom, 900 sq. ft. house and love it. I agree with the comment above, sometimes I do get house envy at other gorgeous spacious houses I see, but in the end I am so grateful we have our little house that we could afford even if we both lost our jobs and had to work part time in retail or something.

    So, we are not planning to move when baby #1 comes this Feb., but we are going to make whatever budget cuts necessary so that I can stay home at least part time. Unless you love your job and need it to be fulfilled, I just think it sounds like a terrible life to be rushing around all week, leaving your kids with someone else, AND giving up a good chunk of your salary to do so.

  8. FrugalBabe says

    No Pink Here and Frugal Vegan Mom – I know what you mean about house envy, and I also know what you mean about realizing that the fancy home isn’t really what you want after all. We have lots of friends and family members who live in custom homes filled with granite counters and beautiful hardwood floors and deep sinks and steam showers. When we’re in their houses, I do sometimes feel a twinge of envy (our house is basic builder stock, and although we love it, there’s nothing fancy about it). We bought our home because of the yard, and we were lucky that the house is nice and clean and well-taken-care-of. Usually all it takes to get rid of the house envy is reminding myself that all of those homes cost $100,000 – $400,000 more than ours. Since we’re on a mission to pay off our home as fast as possible, I am very glad that our mortgage isn’t any higher than it is!

  9. FrugalBabe says

    April – glad to hear that I inspired you :) And good question about our investing. I just published a post about it.

  10. Sam says

    I back pedaled my career about 5-yrs ago because I was working so much I was paying people to raise my son & they were screwing him up.
    His Dad is non-existent so I knew the child had to have one parent he could count on no matter what & I nominated myself. It took a couple years for my ego to simmer down because I loved running & fixing complex network systems all day but my son will only be 10 once and he needs me. Network stuff will always be there. While everyone makes fun of me and thinks I’m dim for not getting a real job, the school district job I have allows me to be there for him through thick & thin. We just have no money but that will come to pass too!

    I bought a much smaller house & I regret the specific house my agent talked me into (after house hunting for 8 months) because it was so poorly maintained that it’s going to take 10yrs for me to get it decent & sound but I do like the small mortgage. I also like having less housework and how much more solid framed my older home is then the newer ones.

  11. says

    yes, we did cut a lot of expenses to focus on what we really want. MS Money helped in giving the picture of reality when we assumed all was well. That opened our eyes and we were able to save up for the down payment for a house and still afford the stuff from health food stores.

  12. says

    We recently came across the opportunity to move across country. We would have lived in a larger home with landlords who were open to all sorts of things (like cows) for several hundred dollars cheaper. Everything about the move made sense- the money savings, the chance to live our dreams- but two things kept us here. Our friends and our church. We have an awesome community of people to be involved with and amazing friends here. At this point in our lives we decided that friendship, though intangible, was the higher priority. It was a hard choice though.

  13. Lauren says

    We upgraded to a bigger, twice as expensive home on purpose. When we had a smaller home and more disposable income, we blew it on eating out, trips, clothes, etc etc. Now all that money goes into our mortgage and we’ll be better off in the long run. I find there’s a real pressure for women to stay home with their children and depend upon their partner’s income. I have a 2 year-old son and a career that I love and have no desire to put on hold, or leave behind. Although I love my son more, he is happy in daycare and I am so happy to see him during the evenings and weekends that all of our time together is so special and we have a blast. I’m totally focused on him and not half-focused, while I’m cooking, cleaning etc., which is what would happen if I stayed at home.

  14. MK says

    I would love to be able to stay at home when children come into the picture! My boyfriend and I currently both own our own homes, but when we get married we can easily sell one (or rent one out) and live off of one income when the time comes. We both drive inexpensive cars and want to keep it that way. No upgrading to compete with the Jonses here!

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