Going from Two Incomes to One

Dear Mr. Dad: Our first child is due in six months and we’ve decided I won’t be going back to work. How do we go from dual income couple to single income family without feeling the pinch too much?

A: Congratulations on thinking about this now—I’m always surprised at how many couples put off talking about money until they’re on the way home from the hospital, baby in hand.

The very first item on your list should be to pay off your credit cards. (If you don’t have any credit card debt, you’re already one step ahead). Next, start sinking your entire paycheck into savings and practice living off one salary. This will help you quickly identify any holes in your budget while you still have the security of two paychecks. [Read more...]