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It's possible but it's a hardship from the get go. You have to accept that you will 1) have lesser housing options available to you 2) less disposable income to pursue discretionary spending.
That said, the devil is in the details. A one-income household where the breadwinner makes twice the median income would be better off than a two-breadwinner household in which both make right at the median income. I don't think the article really assumes this scenario, the article is hinting at the proposition that a household will attempt to have a hack at it on the proverbial 60K median household income. 60K for a household is a hardship whether one, two or three people are working to make that figure.
The article is missing the point. The real key to success is to have a two income household where the household lives and depends on only ONE income, leaving the other for insurance and discretionary spending. But people don't do this, people "NEED" two incomes just to afford outright the lifestyle they think they're entitled to as Americans. Which is why they are insolvent the second either income stream disappears or gets reduced.
I too long for the days where one could have a decent life on one income. Those days are gone. Today they decision to live on one income means accepting a lower standard of living for the opportunity cost of not being in debt. The majority of Americans STILL consider that opportunity cost unacceptable. It's gonna be an embittering couple of decades for young American households going forward.
When are we Americans going to realize that all this time, we've been chasing our tails.
The one-income lifestyle is out of reach because we made it so. By deciding that working was such a wonderful thing, and being willing to accept being in large amounts of debt, we pushed the one-income lifestyle out of reach for all but those earning well above average income.
Since 1970, when the one-income lifestyle was still the norm, three major components of family costs have soared, all but one of them driven up almost exclusively by the fact that more money was available to spend on them due to the prevalence of two-income families -- housing costs, health care costs, and college education costs.
Today, the average two-income family is worse off financially than the average single income family was in 1970. All we really accomplished by effectively doubling our workload was to transfer a huge amount of wealth to people who owned property prior to our great 'liberation.'
We do it on one income too. My wife stays home, we have three kids, a mortgage and we do fine on my somewhat adequate but not so impressive government salary. We live within our means, avoid debt and when we do take out loans we get the best terms and rates thanks to our good credit rating(s).
Of course, we would be screwed if something happened to me and I couldn't work, but what is life without a little bit of anxiety?
Still, I think it's a better way to raise a family. Kids should be raised by their parents, not daycare, and we don't need anything too fancy anyway. We have a smaller but very nice home in a good neighborhood (which I bought for cheap and restored myself) and 2 decent cars (1 paid off),eat just fine, don't wear Armani, but don't wear rags either; I don't feel like we have accepted a lower standard of life at all, just that we've been wise about our spending.
The one-income lifestyle is out of reach because we made it so.
That is not true. The one oncome lifstyle is dead, but only because we don't THINK we can do it. My wife and I have been doing it now for five years, and my family has never been stronger. I work full time, and my wife does work, but only part time, 15-20 hours a week at a low pay, low stress retail job. We are actually much better off now than when we both worked full time, because we now KNOW that we have to budget our money and watch all expenses, and we don't have to pay the huge daycare bill. I won't get into a long, detailed list of everything we do to make it work, but I can tell you this: we have ZERO debt, other than our mortgage (which we are paying down as early as we can), we have more cash savings now than we ever had when we had two full time incomes, and we continue to build our investment portfolio. We are doing this with four (yes FOUR) kids, ages 5 thru 14, who are all learning the importance of saving and avoiding debt right along side of us. Oh, and our families quality of life is 1000% better than it was when we were both rushing off to work early and dropping the kids at daycare, and having grandma pick them up in the afternoon and watch them until we got home, etc, etc,. etc. Eliminating the rat race, and having Mom home when the kids get home from school has improved the quality of life for all of us in so many ways - more time to help kids with school work makes for better grades, earlier, healthier meals together at the dinner table as a family, I could go on for hours.
The largest sacrifice we have had to make to get to this point is keeping our two older, paid for vehicles and avoiding the temptation to upgrade and take on car payments. It can be done, and it's actually a much better way to live then we have been conditioned to think. I suggest people read this book. We read this book when my wife lost her full time job 5 years ago1, and it changed our lives:
The one income is dead cause we are too greedy to have one person not earn the 50k a year "extra"... when it comes down to it... its money... having an extra 50k to spend is too tempting for most families to give up...
That is not true. The one oncome lifstyle is dead, but only because we don't THINK we can do it. My wife and I have been doing it now for five years, and my family has never been stronger. I work full time, and my wife does work, but only part time, 15-20 hours a week at a low pay, low stress retail job. We are actually much better off now than when we both worked full time, because we now KNOW that we have to budget our money and watch all expenses, and we don't have to pay the huge daycare bill. I won't get into a long, detailed list of everything we do to make it work, but I can tell you this: we have ZERO debt, other than our mortgage (which we are paying down as early as we can), we have more cash savings now than we ever had when we had two full time incomes, and we continue to build our investment portfolio. We are doing this with four (yes FOUR) kids, ages 5 thru 14, who are all learning the importance of saving and avoiding debt right along side of us. Oh, and our families quality of life is 1000% better than it was when we were both rushing off to work early and dropping the kids at daycare, and having grandma pick them up in the afternoon and watch them until we got home, etc, etc,. etc. Eliminating the rat race, and having Mom home when the kids get home from school has improved the quality of life for all of us in so many ways - more time to help kids with school work makes for better grades, earlier, healthier meals together at the dinner table as a family, I could go on for hours.
The largest sacrifice we have had to make to get to this point is keeping our two older, paid for vehicles and avoiding the temptation to upgrade and take on car payments. It can be done, and it's actually a much better way to live then we have been conditioned to think. I suggest people read this book. We read this book when my wife lost her full time job 5 years ago1, and it changed our lives:
Good luck to anyone interested in changing the way they live for the better.
I'm very happy to hear of your experience. I fully agree with you that a one-income lifestyle is far superior from a quality of life perspective than having a husband and wife who are constantly stressed out from working all the time.
I should have phrased what I said a bit differently. I think that, generally, the one-income lifestyle is unattainable to people who have made it unattainable through their own choices. The need to always have 2 new(er) expensive cars, a big house, etc. leads to the need for 2 incomes. In addition, the 2-income lifestyle is more expensive in and of itself, since these families eat out more, have to pay for child care, extra activities, etc.
Not to pry into your business, but what is your level of income relative to the average? I think your formula works well with an above average income, but the people who have been hardest hit by the feminist-inspired 2-income economy are the lower middle class, who have lost the ability to supplement the man's modest income and lower middle class couples now are competing economically with 2-income families in which one member earns more than the two of them together. I have a female friend who is lower middle class and a rabid hater of feminists for this reason. They're really struggling with 1-1/2 incomes because her husband doesn't have a very high income.
The one income is dead cause we are too greedy to have one person not earn the 50k a year "extra"... when it comes down to it... its money... having an extra 50k to spend is too tempting for most families to give up...
I think it works OK when there are no children, but when kids are involved the costs of keeping them in child care and all the rest of the stuff that has to be farmed out at a cost, I don't think is worth it.
having an extra 50k to spend is too tempting for most families to give up...
Yes, but having that extra $50K is mostly an illusion, what with daycare, higher commute costs associated with getting to work (gas, car wear and tear), possible higher tax bracket, etc, etc. Add in the stress of this type of lifestyle and it just isn't worth it. The price paid in the end is simply too high.
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Not to pry into your business, but what is your level of income relative to the average?
Between my full time job and my wife's part time job, we talking approx $65K. The key to making the whole thing work is staying out of debt, and having cash saved to be able to cover most emergencies and buy most things we want with cash. If you avoid the montly car payment (or two car payments) and high interest credit card debt, you can manage to save a LOT more than you'd think. It's very difficult at first to buckle down, pay off the debt and then sacrifice a lot of wants to build youir savings, but once you do it - WOW, what a sense a freedom! A lot of people seem to think that "living within your means" means living in dumpy apartments in bad neighborhoods, taking buses instead of driving and eating mac and cheese for dinner five nights a week, but what they don't understand is that the longer you live within your means, the greater your means will become. It can be done, and you don't need the one income to be six figures for it to work.
Yes, but having that extra $50K is mostly an illusion, what with daycare, higher commute costs associated with getting to work (gas, car wear and tear), possible higher tax bracket, etc, etc. Add in the stress of this type of lifestyle and it just isn't worth it. The price paid in the end is simply too high.
Between my full time job and my wife's part time job, we talking approx $65K. The key to making the whole thing work is staying out of debt, and having cash saved to be able to cover most emergencies and buy most things we want with cash. If you avoid the montly car payment (or two car payments) and high interest credit card debt, you can manage to save a LOT more than you'd think. It's very difficult at first to buckle down, pay off the debt and then sacrifice a lot of wants to build youir savings, but once you do it - WOW, what a sense a freedom! A lot of people seem to think that "living within your means" means living in dumpy apartments in bad neighborhoods, taking buses instead of driving and eating mac and cheese for dinner five nights a week, but what they don't understand is that the longer you live within your means, the greater your means will become. It can be done, and you don't need the one income to be six figures for it to work.
I completely agree with you.
When I talk to people about their finances, I use the rolling snowball analogy. One way or another, you have to push the snowball up to the top of the hill, and it takes some effort to do that. Once you reach the top, the snowball goes down the hill mostly on its own power, gathering momentum as it goes. When you're in debt and not saving money, all the momentum is against you, but once you build up savings and investments, the momentum starts to work in your favor.
So few Americans understand this. They spend their whole lives without every getting that snowball up the hill, delaying it by maxing out on debt, buying big houses they don't need, etc. Then they hit their mid 40s, or maybe 50s, and realize they have nothing. And at that age, it's much harder to build momentum than it is when you're younger.
I hope you keep doing things the smart way. I think we need a campaign to make it patriotic to save and live within your means. It has truly become a national security issue, IMO. We can't go on running huge capital deficits that we depend on countries like China to fund. It's absurdly stupid, like being addicted to drugs. Our government will never clean up its act unless forced, so enough Americans have to wake up to the danger of the path we're on, straighten out their personal lives, and force the government to straighten out. The bailout mentality is so dangerous.
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