Adjusting to Living on a Smaller Income

Is is possible to adjust to living on a smaller income? Well, that depends on the individual. If it is for survival I hope your common sense kicks in and you are able to make the adjustment. Living on a smaller income is not as bad it seems. When you have expenses which are hard to get rid of you should make sure you call to lower payments.

Less is more

When living on a smaller income you can count on your friends bumming off you. Depending on your friends my statement may not be entirely true. Living on a smaller income has its perks. If you are dating and she is interested until she finds out you make less than average for your age than drop them.

Tax advantages

Living on a smaller income puts you in a lower bracket or puts within range of a lower bracket. I believe the standard deduction is $5,200. For example, if you used to make $45,000 and now you make $37,500 the standard deduction drops you into a lower bracket. In some cases because of the tax situation you will not see much difference in take home pay. The major difference to swallow is the conversation talk, but who really cares in this type of economy.

Less spending

If you are not capable of spending large amounts managing debt should be manageable. It is better to have living expenses based on $40,000 and experience a pay cut than to be making $400,000 and experience a pay cut. Less spending opens your eyes to realizing what you need in life. Most of the time the allure of the lavish lifestyle is not about the cars and the house it is usually the ability to spend more time with family.


With less income your likely to not shop or be in places out of your price range. Living on a smaller income does not mean you can’t enjoy life. You have to keep the ambition alive. You can aim to get back to your lifestyle and do it better or not return and find ways to be extremely resourceful. Managing your credit card debt and other debt is an easier mountain to climb than someone making six figures.

There are many ways living on a smaller income can have a positive impact. Bigger is not always better. Good luck!