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November 4, 2019

Living Paycheck to Paycheck on $100,000. How can we improve?


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Our first question of the month comes in from Julie. Well, it’s really a half question/half statement but nevertheless, here we go …

Try this on: $92,000 income family with one baby.

We live in a crummy small 2 bedroom rental with poor heat and cracks in the walls. It’s on the edge of the city, the best balance of travel time to work vs price we could find.

My field (international aid/development) is generally in major cities and we like our secure jobs so not ideal to leave.

My round trip to work is 1.5hrs with driving our baby to daycare then transiting myself to work. If I transit all the way, it's 2.5 hrs each way. If I drive all the way it's $300+ in parking/month. There is no transit to my husband's work so we need 2 cars.

Tell me how to do better.

Bring home is $5,320 per month.

  • $1,700 Rent
  • $1,125 Daycare (for 3 days a week, work is allowing me two work from home days – highly stressful with a 16-month-old, only daycare we could find with space, normal going rate)
  • $380 car insurance
  • $470 gas + transit
  • $800 groceries (we eat simple, I go certain days and times even for sale meat)
  • $250 phones (2 personal my work phone I require since I'm home 2 days)
  • $120 Internet & share of Utilities
  • $482 Student loan repayment
  • $120 Baby programs and play (sportball, art, this is important to us)
  • $100 Diapers
  • $100 gym membership (the one thing we do for ourselves, and we actually go).

That's $5,527.

It doesn’t include:

  • Cleaning products or miscellaneous
  • Car repairs
  • Money we send to Africa for my husband's siblings to be able to go to school
  • Gifts
  • Eating out (which we rarely do).

My husband has tried to pick up extra work in food delivery, but it works out to $12-15/hr, not including gas and wear on the vehicle which is already 10 years old – so not really worth the extra stress on us all. I do side contract work when it comes, but it still doesn’t make the budget work.

Sad woman with head down in black and white

Give me an answer other than ‘budget better or make more’ or ‘unroot your whole family and leave your jobs and support system to go somewhere you’ll be unhappy’. 

Get it through your head the pull up your bootstraps advice no longer works.

STOP THESE RIDICULOUS USELESS ARTICLES. Say it like it is. Unless you making over $200k or born into it, you're screwed. Our current economy and the world doesn't work like it used to.

Okay, I'm sensing a lot of frustration, anger, and stress from you, Julie.

You’re a young working parent with a 16-month old trying to just live and enjoy life a little bit. It doesn’t seem to much to ask, right?

You’re wondering “why is this so hard”?! 

It sounds like you’ve read or seen a lot of articles or blog posts (including mine) that have made you angry. They make it sound easy to get the life you want just by “pulling up your bootstraps” and “hustling harder”.

You’re right. That type of advice can be frustrating when you’re already hustling and working harder than you ever have before but can’t find a moment to relax or see the light at the end of the tunnel. 

You asked me “how you can do better” … so I’ll do my best. Here are 5 ways I think you could improve your financial and emotional well-being:

1. Try to Not Take Online Personal Finance Advice So Personal

A lot of online personal finance advice is generic because there is very little time spent with the person seeking advice. Oftentimes, it’s broad advice that can provide motivation and a general sense of direction for people. 

For example, even with all of the detailed information you provided, I still don’t know:

  • Where you live (my assumption is New York or San Francisco, but again, I’m assuming)
  • What your husband does for a living
  • How much debt you have
  • If you have anything saved for retirement

Without this information, my advice or opinion won't be as good.

There are folks who love this type of generic advice because it allows them to think introspectively and decide which path is best for them.

I, for one, am a personal finance podcast and book junkie. I consume a lot of content, decide which advice I like the best and then I go for it. I’ve had a lot of failures by following the advice of others but I’ve had a lot of success as well. 

2. Seek Out 1-on-1 Financial Coaching and Planning

Instead of reading personal finance articles, books and listening to podcasts for inspiration, try meeting with a professional coach or advisor. This way you can get past the generic and get more specific. 

This can come with an added cost, but just like your gym membership is important for your mental and physical health, financial coaching is important for your financial health. 

Two men sitting together discussing something important

Here are 3 women that I admire that provide financial coaching services from the comfort of your own home:

1. Tori Dunlap

After saving $100,000 by age 25, Tori Dunlap is dedicating herself to helping women make more money and live a life of financial freedom.

Related Interview: Reach Your First $100,000 – with Tori Dunlap

2. Whitney Hansen

Award-winning podcast host and money coach Whitney Hansen helps millennials pay off debt and achieve financial independence. 

Related Interview: How to Build Your Credit Without a Credit Card – with Whitney Hansen

3. Jessi Fearon

After paying off her mortgage on less than a $50,000 household income, Jessi Fearon is helping other families achieve a sense of freedom with their money. And she’s raising three kids at the same time.

Related Interview: How to Pay Off Your Mortgage Early Making Less Than $50,000 Per Year – with Jessi Fearon

By getting more granular with someone who has been in your shoes, you can gain a perspective you’ve never experienced before. You’ll feel like someone is on your side on your journey to financial empowerment.

3. Realize This is a Difficult Season in your Life

Raising a 16-month old while working in a big city with a horrendously long commute can be absolutely draining. The stress compounds when your money situation is tight. 

Try to step back and realize that the situation you’re in today that seems so dire won’t last forever. It’s going to get better. 

  • Daycare Costs:  Your 16-month old will eventually be in full-time school. Soon enough, you’ll have no daycare bill if you choose a public school near home. 
  • Income:  Things may be right now, but you and your husband will eventually make more money in your careers. It sounds like you’re passionate about your job. That passion will produce more income for you in the near future. 
  • Student Loan Debt: As you grow your income and pay down your debt, you’ll be able to free up more room in your budget for investing for retirement, saving for the future and having more fun. 

This is just a season in your life – albeit a very rough one. Just take it one day at a time and make small incremental improvements that help you and your family have a happier life. 

4. Pause on the Big Things, Focus on the Little Things

You’ve clearly stated that changing jobs, moving and more side hustling is out of the question for you. I've got it. Heard ya loud and clear.

Let’s focus on 5 areas that could potentially improve your financial situation:

Decrease Car Insurance Payments

(Potential Annual Savings:  $500)

You’re paying $380 per month on car insurance. I don’t know much about your cars, driving record, your specific coverage needs or where you live, but there may be an opportunity to save some money here. 

Reach out to 3 car insurance providers in your area and get competitive quotes for your business. Try some of the big guys like Geico, Progressive or Nationwide. Usually, they have aggressive rates for “new customers” so you could potentially save $500-$1,000 per year with a simple phone call. 

Tell your current provider you need to reduce your car insurance payments and you have some competitive offers from other providers. See if they will match it. If not, leave and take your business and money elsewhere. 

Related Article: 15 Ways to Save More Money When You're Living Paycheck to Paycheck

Reduce Daycare Costs

(Potential Annual Savings:  $1,000)

You mentioned that you have a “support system” where you live.

Do you have a family member who would be willing to watch your 16-month old for one day per week? This may not be a possibility, but if it is, you could save quite a bit of money. 

Also, consider signing up for a Dependent Care Flexible Spending Account at your office. Let’s say you do the current Dependent Care FSA maximum contribution at $5,000 per year (if married, which you are) and you’re in the 10% tax bracket. You’d save around $500 per year in taxes (or $42/mo).

Refinance Student Debt 

(Potential Annual Savings:  $500)

I have no clue how much you owe on your student loan debt or your interest rate, but refinancing may be a smart option to consider. Depending on your situation, you could bring your interest rate down quite a bit and save hundreds of dollars per year. 

Shop for MVNO or Pre-Paid Cell Phone Plans

(Potential Annual Savings:  $300)

A few months ago, we went to a Pre-Paid cell phone plan with Verizon. We have the same coverage, the same iPhones, and the same data plan.

Now, we pay $30 less each month. We had to fully “pay for” our phones instead of making monthly payments on them, but either way, we’re very happy with lower monthly payments. This may work for you too!

MVNO Cell Phone Plans are a popular way to get the same power of the big networks with a smaller price tag. Check it out … it could save you a lot. 

Shop Discount Grocery Stores and Meal Prep

(Potential Annual Savings:  $2,000)

Sometimes switching to a new grocery store can save you quite a bit of money. My wife and I switched from Kroger to Aldi a couple of years ago and we saved around $3,000 per year. If you don’t have an Aldi near you, consider Wal-Mart or another discount grocery store. 

Making Sunday “Meal Prep Day” can help you prepare for the week, eat healthily and save a lot of money. This could be a fun and cheap date tradition for you and your husband as well. 

That’s potentially $4,300 back in your pocket each year! Outside of these 5 ideas, there are dozens of other ways to save more money when you’re living paycheck to paycheck. Give some of them a try and see what works for you. 

Related Article: How We Decreased our Spending by $20,000

5. Find Your Tribe

The hardest challenges in life are made a lot easier when you have people who are supporting you along the way. You’re in a tough spot right now. Young parenthood can be mentally and physically exhausting. Find others who are in the same position so you can confide in them and they can confide in you. 

There are dozens of Facebook groups that are focused on parenthood, motherhood and improving your financial situation. Find one that works for you. I started a Facebook Community with a few friends of mine who are young parents trying to figure out this whole marriage, kids and money thing.

If you’re not into Facebook or online groups, find some other mothers or parents in your community and see if you can meet them for coffee. Sometimes just talking with someone can help us tremendously. 

Julie, I want to thank you for being open, honest and candid with me. I hope my suggestions help you. I truly do. 

Best of luck with this difficult time in your life. I know it’s not easy living paycheck to paycheck, but remember it’s only a season. Better times are coming. 


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Andy Hill

Andy Hill, AFC® is the award-winning family finance coach behind Marriage Kids and Money - a platform dedicated to helping families build wealth and happiness. With millions of podcast downloads and video views, Andy’s message of family financial empowerment has resonated with listeners, readers and viewers across the world. When he's not "talking money", Andy enjoys being a Soccer Dad, singing karaoke with his wife and relaxing on his hammock.


  • Wow, this is a real conundrum. Most people would suggest a $100k income is being well off! That is until they actually do the sums! I certainly know how difficult and expensive life can be with a young child, and particularly in a large city.

    As an adviser for more than 30 years I can certainly concur that online advice will always be generic in nature. The core of personal financial advice is to fully understand a client and their needs prior to the rendering of any advice. Obviously this can’t be achieved within the confines of advice orientated posts!

    What I will offer however is for you to reflect deeply on your current situation. You only have only 2 courses of action that can be taken. One is to earn more money and the second is to reduce your expenses. Obvious, of course it’s obvious. Rather it’s the action needed to rectify your situation that’s not. Here’s some ideas.

    In regards to you earning more money. I note your expenditure includes Internet connection. Put it too productive use. Have you explored ways of earning online? There are certainly many ‘side hustles’ that have evolved over recent times. Maybe assignments that you could be paid for, based on yours and your husbands knowledge and experience. I note you are in foreign aid, does this translate to individuals, would they pay you for advice. Could you start a web site giving advice to newly arrived immigrants or those wishing to immigrate. Or do you have other talents that could be leveraged online? As I wrote earlier, reflect on your situation deeply.

    In regards to saving money, I always say “shop it” For every item we spend money on, there is a cheaper alternative. Now in saying that, cheaper may not always be suitable to your situation but unless you have exhausted the process of ‘shopping around’ you don’t know. Food is a great place to start. As an amateur cook myself I am always devising recipes to save money. Look at French and Italian provincial style cooking for inspiration. ( I can get 4 different dishes out of one chicken!)

    The same goes for utilities, services, insurances etc etc, shop them around until you have exhausted every single option.

    Your accommodation sounds to me like the landlord is failing in their responsibilities. Can you get the walls fixed and the heating improved? Why not embark on a search for alternative suitable rentals. You should make this a continuous task. as perfect places don’t ring you! You just might find something, but it’ll only happen if your searching.

    Finally, ensure you have written goal(s) and the written plan to achieve them. And don’t expect instantaneous results as they just won’t happen. But long term persistence coupled with the right plan will always pay dividends I can assure you.

    • I love how your overall message is one of action … Julie’s in a tough spot for sure, but there’s always something we can do to improve our situation. And just because its rough today doesn’t mean tomorrow will be.


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Marriage Kids and Money Podcast

About Marriage Kids & Money

The Marriage Kids and Money Podcast is dedicated to helping young families build wealth and happiness.

With over 400 episodes and counting, we share interviews with wealthy families, award-winning authors, and personal finance experts to help you find your version of family financial independence.

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