The Best Hack I’ve Learned For Surviving On One Income

In this day and age, is it possible to survive or even (gasp) thrive on one income? With the cash envelope budgeting system, I'm living proof that it can be done.

By Ashley Ward4 min read
Pexels/Karolina Grabowska

“You’ll never make it on one income. It’s not the 1950s anymore. With the economy like it is, you will never be able to stay at home with the baby.” That was the voice in my head, repeating the lines society had told me my whole life. I had to go back to work right after my maternity leave was over. I had to leave our son in childcare because we had to have two incomes, right? 

But what if I didn’t want that life for our family? What if we decided to do something different? With my husband’s out-of-town work schedule, I knew that if we were going to make a lasting change in the financial trajectory of our family, I would have to be the one to manage it. So, I took inventory of our financial weaknesses and came up with a viable plan to challenge them.

1. Get Organized

I had heard of and used some of the Dave Ramsey concepts before, but not all of his principles stuck with me. An aspect of his philosophy that did resonate with me, though, was the cash envelope system. It was a tangible, all cash system where I could see and feel exactly what I was spending. I knew I would need the visual aid to control our spending. So, going on what little I knew, I googled the cash envelope budgeting system and quickly found The Budget Mom. She had an array of cash envelopes that I could print out and use to hold our household money, a wallet to hold my envelopes when I was out and about, and, my saving grace, the Budget By Paycheck Workbook

At that point, I had a three-ring binder that held contacts for family and friends, passwords, and paint samples. In this binder was one solitary piece of paper that was our “monthly budget.” I used the same paper every month, no matter that each month had different events, goals, and needs. 

So, the first thing I did was order the cash envelopes and the Budget By Paycheck Workbook. A week later, my big blue box arrived, and I immediately got to work organizing our income and expenses. The workbook was big, bright, colorful, and perfect for our needs. For the first time, I felt like I had a space truly dedicated to our finances that was geared towards me. With all of my organizational efforts coming to fruition, I began to wonder if we should expand beyond our mere three envelopes and even into so-called “sinking funds.” Was it really necessary for our family? This was when I saw our second financial weakness – we had a generic financial plan.  

2. Create a Customized Financial Plan

If this change was going to have staying power long-term, I was going to have to customize it to fit us. I began to dig in to what envelopes and sinking funds (saving a little bit of money each month for a large goal) we really needed. I looked at our checking account and credit card statements and began to break down our spending into categories. I set a budget limit for each category that would enable us to realistically look at what we had been spending and what goal amount we wanted to achieve. I arrived at the cash envelopes we still use today: Personal Money, Eating Out, Miscellaneous, and Household. Biweekly (when my husband got paid), I would take the budgeted cash amount out of the bank and stuff our envelopes. Once the money in that envelope was gone, it was gone – no more spending. 

Next, I looked at our future goals to see what was coming up that we needed to begin saving for, like Christmas, birthdays, property owner fees, oil changes, house maintenance, subscriptions, etc. and started sinking funds for each goal. I tallied up the amount we would need and divided it by the 26 yearly pay periods. This would eliminate so much stress when the time came to pay for those occasions. Finding $50 per pay period was so much easier than finding $1,200. 

Now, you may be wondering where the most important envelope of all is in my new plan: the dreaded grocery envelope. For that, I knew we would have to have a radically different method, but I also knew with grocery pick up (and let’s face it, a 6 month old in the height of Covid), I needed this to be cashless. So, how to make this work? Would my plan work if we were cashless for one category? How could I keep track of our spending without my beloved cash? By opening a second checking account! This was when my eyes were opened to the third financial weakness we had. We had not utilized a zero-based budget.

3. Use a Zero-Based Budget

As Kumiko Love (a.k.a. The Budget Mom) explains, “This method of budgeting is a strategy where every dollar you earn has a job. When you complete your budget, there should be zero dollars ‘leftover’ in your budget. This is why it’s called a zero-based budget.” 

After our bills were paid, envelopes stuffed, and sinking funds funded, the money that was leftover could no longer be seen as “extra” but as gas and grocery budget money.  Furthermore, we needed to ensure that we set spending caps on these categories. If our grocery budget was $200, then that was all there was available to spend. I moved our budgeted amount for those two categories into their own account. I began to utilize grocery pickup differently so I could see our total as it increased and remove the unnecessaries when needed to fit within our budget. In order to keep up with the amount of money that was in our individual gas and grocery budget without having the physical money, I used cashless trackers. I wrote down our beginning balance and any money spent from that category to keep an ongoing balance. 

After budgeting for everything, including gas and groceries, we had to decide what to do with any leftover money. We made the decision that it would go to further our personal savings goals, be it building our emergency fund or saving for a large future purchase. We began promptly moving it into that corresponding account to ensure it was not seen as “free fun money.” We want all funds to be designated with a plan, a job. 

All of this organization, customization, and planning for our money was great; however, it didn’t matter if we weren’t seeing results. I needed a quantifiable way to show myself and my husband that we were controlling our spending and reaching our goals. How could I do that? This led to the final financial weakness we had yet to overcome: not tracking our spending.

4. Track Our Spending 

If there is nothing else that can be gleaned from this system it is this: track your spending. Full stop. It has the biggest impact on your overall financial picture and plan for your family. It shows you where you are and where you are going to be if your plan continues. In doing this, you can analyze and course correct when needed. 

Before all of these changes, I had a small checkbook register to keep up with the amount in our checking account if I debited something. But I knew I would need more than that. I needed space to write down our cash, credit card, and debit card spending. Within my new workbook, I found several expense tracker sheets that would fit my needs. I began to set these up with our beginning balances every pay period. If we spent money from our cash envelopes, it went on our cash tracker, and the same with our checking account and credit card. I categorized every expense into the same spending categories I had started with (things like household, food, entertainment, etc.). Every time money left our home I wrote it down; then, at the end of the pay period, I was able to add up each of our categories and compare it to what I had budgeted initially. I could tell at a glance where we needed to pull back and where everything could stay the same for the next month. 

Closing Thoughts

As I addressed all of our financial weaknesses one by one, I saw our family’s upwards trajectory, and it thrilled me! We had all of our bills paid, our debt gone except our mortgage (which we paid off in early 2023), and our sinking funds funded right on time.  These large financial goals I had set up for our family had all been met and exceeded; but what made me the proudest was being able to see how far we had come. We went from one page in a three-ring binder to a completely new, organized financial system that would enable us to grow even further with our financial goals.

Four years into being a stay-at-home mom, we are in a better financial position than when I was working full-time. It may not be the 1950s anymore, but we can still see the value of the cash system that our grandmothers used. It can open up financial freedom that will allow us to make our own decisions and carve out the roles we choose – not what society chooses for us.

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