Thursday, December 13, 2007

Living At The Poverty Line

I am aiming toward the poverty line, not away from it.

I had never thought one of my financial goals in this way, but something clicked recently. If you consider our net expenses after our roommates pay us, we're running around $700/month of basic living expenses. The poverty guideline for our size of family is $1,430/month. Our finances changed this way out of necessity (we were below the poverty line for part of the year, including roommate income) as well as our goals to get out of debt. Our basic living expenses can't go much further down, so our basic goal now is to keep an eye on the non-required expenses and boost up that income as much as we can.

If my only goal was to work minimally, I'd just have to find enough work to bring home $700/month. My goals right now are not just that, but getting out of debt, so I am focusing on the short term of increasing income in order to win long term.


Dedicated said...

Even with just the 3 of you, I have no idea how you can live on $700 a month. You are definitely living like "no one else". I spend almost all of that in just my house - payment $422, electric $70, gas $92, water $40 = $624

What about food? Car insurance? health insurance? life insurance? home owners insurance? auto fuel? Could all these expenses be rolled into that amount?

Sick of Debt said...

Here's some details of what I consider right now our basic necessities:

$1127 Mortgage (includes homeowners insurance)
$240 Car Gas
$30 House Phone
$89 Electricity
$45 Water
$77 Natural Gas
$160 Groceries
$95 Life Insurance
$30 Toiletries
$200 Other Car Expenses (insurance, stickers, repairs, not monthly)

Total: $2093/month

Rental Income: $1300/month

Required from employment to cover basic needs: $2093 - $1300 = $793.

I've got some calls to make to reduce the life insurance amount by $30-40, but everything else is streamlined as much as we can. If I ignore the life insurance as a basic need, then my rough number this morning of $700 would be about right.