This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Can you afford to fly on a solo income model?
The reliance on borrowing is still high, with more than one-third of households having to turn to a credit card, personal loan, or family and friends in the face of unplanned expenses (Source: Greg McBride – CFA, Bankrate)
1. The $1,000 Emergency
If you had a $1,000 emergency come up would you be able to pay for it in cash, or would you need to charge it or use a loan?
Naturally, unexpected expenses will arise. Having two income sources will help you better prepare for them when they arise, so you don’t have to dip your feet deeper into the debt pool.
2. Average Household Income
Only 5% of American households earn more than 200k in income. The other 95% earned an average income of $67,521 in 2020, a decrease of 2.9 percent from the 2019 median of $69,560; this marks the first statistically significant decline in median household income since 2011 (source: US Census data 2021).
Calculate in childcare, food, housing, transportation, taxes, clothing, education, and leisure, and you will come to find out that a $67,000 salary doesn’t provide much wiggle room for families. Some households earning this income often include more than one income source, but many don’t.
Implementing a second income source will help you cover your basic and emergency costs and help ensure you are putting money away in your nest egg for future use.
3. Who’s Saving?
One couple I knew had one income source. They were drowning in debt, and neither was investing; it was their prime investment years, too. If they had implemented a second income source, they could tackle multiple goals:
Cover basic expenses
Cover emergency expenses
Cover investing and saving
Pay down debt
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They only dig themselves further into a hole with one income source. If you can’t afford to live off one income source, don’t force it.
4. Can You Afford One Income Source?
Some people got it like that; they can afford to have one person working and the other not. But if you’re anything like the family example in number 3, which is most people, maybe it’s time for you to step out of denial and realize you can’t afford to remain a one-income source family.
One way to help yourself and come up for air is finding a way to eradicate some of your expenses.
What is superfluous?
What is absolutely unnecessary that you can live without?
Cut it; you’ll throw yourself a life jacket by doing this.
Physical Limitations
If one partner or spouse has physical limitations, you can find remote work, alternative work, programs, or benefits for the physically diverse.
5. Can You Handle A Job Loss?
Recently, I wrote an article called, I’m Very Uncomfortable Leaving My Income Up To Someone Else. The thing about working for someone else is that it’s not secure. They can cut the cord at any moment – even if you feel and believe you’re 100% safe.
If you have two income earners, you have double protection in the case of job loss. It probably won’t be ideal if one person loses their job, but at least not all of the income will disappear.
Always have more than one income source.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.