Can a young couple live on one income?

Some young'ns think a couple needs two incomes to survive these days. Not true. You just have to rein in the gottahaves to the essentials. In the old days of the 1970s, we didn't have cable contracts, phone contracts, eating out several times a week, computers to play with, 2 or 3 cars, homes where everything matched or it got replaced (we even got by with laminate counter tops), TV in every room, college debts, credit card debt, very few people I knew were paying support for another family in another house and few took vacations except the rich (a cottage at Lakeside was $45/week). We didn't have a paid vacation or paid health insurance. And at our house, no one smoked or drank alcohol, and that is a HUGE savings. Refigure your budget with a 1970 plan, and see if you really need to go to work, ladies.

That said, today so many things are cheaper. Computers, TV, microwaves, clothing, even food are a fraction of the cost of 40 years ago. And compared to the 80s, mortgage rates are laughable. A tithe is still 10% and that's the best budgeting tool.

The government shut down scam

When the rest of us have a set back or need to budget, we move money from the non-essentials. Not the government. Those departments raced to spend their allotment before the end of the fiscal year (Sept. 30) because of the use it or lose it mentality, and always asking for more based on what was spent the previous year. If I were short of cash, I would be making coffee at home for 5 cents instead of paying $2 at a shop where I could chat with my neighbors. If I were running low, I'd make every trip in the car count. And I'd make sure my church pledge was paid before I'd take out the credit card at Macy's.

This government shut down has happened 17 times since 1976. I bounced one check in 53 years because I had 2 checking accounts when I was a private contractor and wrote a check on the wrong account. Imagine your credit rating if you'd done this that often. And you don't even get to print money!

How do you cut costs?

That's a big topic in the media today--but it was four years ago too when unemployment was 4.5%, and in the 1990s, and the 1980s during the last big recession. I asked it June 28, 2005, then answered my own question (I do that a lot). I don't. I reread it today, and don't see any changes. Everyone seems to "cut costs" in different ways. Here's my list of non-cuts, and at my age, I'll probably not change what is working (hmmm--could be a motto).

Economically, it makes absolutely no sense for me to leave the house every morning at 6 a.m. and drive to a coffee shop. If you don't do this, you could exclaim, "But that costs you nearly $600 a year, when making it at home is about five cents a cup." Very true. But I read 2 or 3 newspapers, and see 4 or 5 people I know, chat with various folk, so as a social informational event, it's pretty cheap. Compare that $600 to a golf hobby, and you can see it is really pretty cheap.

We eat out about once a week--it's called our Friday night date. When my husband started his own business in 1994, this is one thing we cut for awhile, until we could see how our finances would be, but reinstated it quickly. Sure, I can fix the same thing at home for about $3.00 that costs us $30.00 at the pub, but again, it isn't food, it is R&R and time to focus on each other. It is also a line in the sand dividing the work week from the week-end, and when your office is in your home, you definitely need to keep this ritual (he also dressed for work each day, including a tie). About $1500 a year just to eat one meal. Ridiculous!

I could save about $400 a year if I stopped coloring my hair. That will come, but for now, I prefer to fool Mother Nature and the clerks who ask for ID when I request a senior discount. Brown hair turning gray is not pretty like a brunette turning gray (but prettier than a blonde or red head going gray--just a tip).

We usually get a glass of the house wine (red for the cardiovascular system) with Friday night dinner. I suggested to my husband that we just drink a glass of wine at home afterwards--saving Oh, maybe $500 a year (cheap wine), but he didn't go for that. Frugal, but not romantic.

We really don't need two cars now that my husband is retired. I suggested we get rid of his Explorer and keep my van, but since both cars are paid for (and he really likes his better than mine but his hurts my back). That would be a one time boost to the income, of say $6,000 (resale is the pits even on nice, well kept autos) plus a savings of maybe $300 a year in insurance and $200 in maintenance.

Pets are expensive. Kitty litter, cat food, vet bills, etc. I've not looked at the figures recently, but I think it is something like $6,000 over the life time of a cat, and more for a dog. If your daughter or neighbor won't stop by and look after the sweetie-pie when you're gone, you've got to add in huge boarding bills. But I'm not even going to think about that savings. Pets are good for all sorts of health benefits.

So you see, I could be saving and investing this to leave to our Alma Mater, The University of Illinois, but they didn't graduate any dummies, so we're spending wildly while we've got the chance.

Actually, the U. of I. item has changed. I won't send them ANYTHING because of Bill Ayers.

How ACORN hurts the poor

and scams the middle class. ACORN isn't the only non-profit accepting government money to put people in "affordable homes." They and others, including some well-meaning church groups, contributed to the sub-prime housing failure, which has its roots in the myth that "everyone deserves to own their own home," and the even bigger myth that homeownership is the key to wealth, and therefore banks need to look the other way if minorities or single parents or speculators apply. I've been a homeowner since 1962. We bought a duplex in Champaign, IL with my father's help (his grandmother helped him, and we've helped our children), and although it was a hassle being a landlord, it allowed us to afford something better and make a car payment a few years later. Even so, without his help, we would have done it eventually. But always with 20% down and no more than 1/3 of our income (a wife's income didn't count in the formula in the 1960s) in housing costs. Real income.

That's not how ACORN does it. There are very few foreclosures among people and banks who used the old rules. See the data on negative equity. Foreclosures are very high for no interest loans and accepting government benefits as income. Here's ACORN's website:

With AHC you get:

Lower down payments and closing costs.
No Private Mortage Insurance.
Banks generally require 3 months of mortgage payments in the bank at settlement, but
With our program, they don't, which allows you to buy a home sooner.
Most banks won't count public assistance or voluntarily child support in determining if you'll qualify for a mortgage, but
With our program, all steady income counts.

They are still using that failed formula, but now they are accepting government money to run foreclosure workshops to "help" the people they "helped" the first time around, even though it has been shown that most of those people will fail the second time around too. They really couldn't afford the home ACORN got for them, or didn't want the sacrifices necessary to own a home. But President Obama owes ACORN big time--and no one in his administration will stop this double and triple scamming.

There are many ways to make up that 3 months of mortgage payment in the bank to qualify for a decent bank mortgage--and believe me, you'll need that discipline if you want to be a homeowner--

give up smoking
stop eating out
give up manicures and hair weaves
give up the cell phones
drop your cable subsciption or go to basic-basic
go to the library for your movies
don't lease your furniture or car
learn a few fix-up skills and do your own work
put your family on a cash only budget

and I'm guessing this is not taught to wannabe home owners by ACORN because then the people wouldn't need the hand holding and would become strong and resilient.