Live Below Your Means


Do you live from paycheck to paycheck? To reach your financial freedom you needs to live below your means but within your needs.

In my previous “How To Pay Off Your Credit Card Debt“, I discussed how my husband and I are in our journey to be debt free.

It didn’t happen overnight. It took us some years of trials and errors to get to where we are now.
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One thing we wanted was to stop living from paycheck to paycheck.

We created three different businesses to generate more income. Not all of them are generating income at this point.


At the beginning of 2017, We set target dates to pay off our debts. We implemented the following methods to reach that goal:


We created a budget spreadsheet and listed all our expenses. We set specific budget to meet our expenses.

We set food budget in the past but we never stayed within. This year, we tracked all our expenses using Google Drive. If you have a Gmail account you should be able to use Google drive. It made it easier to access our budget spreadsheet from any of our computers or tablets. Any purchase is recorded under its category.

We classified our expenses into fixed and variable expenses. We trimmed some type of expenses to stay within our budget. For instance, I used to buy meat from farmers and it cost more than what I could afford, to stay within my budget. Therefore, I decreased the amount of meat I bought from farmers this year and purchased meat from the grocery store instead. My meat budget is $95.00 a month for a family of seven including four adults and three kids.


Cash Envelopes

It was difficult for us to use debit card to buy groceries and still stay within our budget. Therefore, we opted for the cash envelopes methods for most of our variable expenses. Every month, we took out cash for food, fruit, meat, gas, and personal allowances. Our grocery budget is set at $375 including $200 for food and non food items, $80 for fruit, and $95 for meat. When the food envelop is empty, we stop making purchases and eat from our pantry. When the meat envelop has excess at the end of the month, we keep it in a second envelop as a saving for meat and stock up on meat when there is meat sales.


Reduce Expenses

To stay within budget, we negotiated a new deal for cable and internet. W are mindful not to let the water run while doing dishes. We  turn the light off when leaving a room. I stopped driving to work to save on gas and usage of our car. We have one car. As a minimalist, I didn’t like the fact of owning two cars. I take the bus to work. I pay the bus ticket out of my allowances of $100 a month. To save even more, I decided to walk to work when the weather is good. It takes me 30 minutes by foot. I exercise at the same time. We don’t throw big parties on holidays or birthdays. You can read more about that here.

Live on one Income

We trimmed our budget to the point that it fits within one income. We then decided to live on one income and use the other income to pay off my husband debts. Even Though we are living on one income of about $2,500 a month, we make excess payment toward our mortgage and save few hundred dollars to cover unexpected expenses like plumbing…

Your net worth

When trying to manage your finances, it is worth evaluating your family’s net worth.

You list your assets (house, cars, 401K, IRA, investments, savings, business income, painting, jewelry…) and liabilities (mortgage, car loan, tuition loan, credit card, business debts…)  and determine the difference between the two to find out if you have a positive net worth or not. This exercise also give you an idea on how your wealth is distributed across your assets.

What are you doing to take control of your finances?