by Brenda Nelson

Created on: April 28, 2009   Last Updated: April 30, 2009

For a period of time I lived on an income beneath what a welfare recipient in the same situation would have lived on. I worked part time for minimum wage at an animal shelter while supporting my daughter. My husband had passed away with no insurance. I had a mortgage to pay, and the widows pension had not yet kicked in (even then, the widows pension and orphan benefit combined would only be just under $500 a month).

-Planning Ahead-

Nobody wants to think that one day their world will be shattered and they will find their wage plummeting, but it is a reality that might occur. Planning ahead for shortfalls in cash later is a good survival tool. Here are some things you can do before your wage is reduced to help you save money.

1. No car payments. Instead of buying the latest model, or even a newer, used car, a cheap car that will get you from point A to point B, is all you really need. Car payments will drain your monthly income. View your car as a means of transportation, not as a status symbol. Buy a cheap car, with no payments, or if you are in an area with good mass transportation, consider that as an option. Living close to jobs is also a good strategy.

2. Cheap Mortgage. Owning your home is always better than renting, if your mortgage payments are lower than an equivalent rental would be. Plan early in life by saving up money for a large down payment on a home. Do not buy the biggest house money can afford, buy the one you can get the biggest bang for your money out of.

3. Limit your Family Size. One child will be a financial burden, every additional child will stress your finances even more.

4. Live within your Means. Do not live on credit. Do not buy things you cannot afford at the time. Every month put some cash away for a rainy day, emergencies, or vacation. Always live below your means, and once a year take stock of how much money you have saved, be willing to enjoy some of it at that time.

-Cutting Costs-

When it happens, do not consider a wage loss to be a "momentary" set-back. You need to act immediately to reduce expenses.

1. Cut additional Television expenses. Stop cable, satellite, additional channels, pay per view, etc. leave your self with the minimum.

2. Cut your Internet. Yes you can live without a computer.

3. Cut your Cell Phone. Landlines are cheaper. If you are tied into a cell plan, reduce your use, and see if you can switch to a cheaper monthly plan.

4. Eat Soup. No joke, a can of soup is usually under $1 or $2. There is absolutely no reason why

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