A Life Without Debt: Surviving the Pay Cut Made Easier

A couple of weeks ago we got the news that the company my husband works for is cutting pay by twenty percent for all employees, for an indefinite period of time. Once I got past the anger and frustration, I took stock of our situation and worked on damage control. While we do have a large emergency fund, I don’t want to touch it unless we have no other choice. Yes, a pay cut could be construed as an emergency, but I think the problem can be addressed through other means. It’s not like we will have no income coming in; we’ll just have less. I decided that I’d also prefer not to lower our savings rate if I can avoid it. And for sure I don’t want to incur any debt.


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7 Responses to A Life Without Debt: Surviving the Pay Cut Made Easier

  1. Awareness Home Funding says:

    Great advice! The first natural reaction is usually panic to a situation like this, but you showed that with a little common sense a setback doesn’t have to become a hardship. Thanks!

  2. DeeDee says:

    My Company just notified all employees that our pay will be reduced 10%, so your post was right on time and contained some great tips. Thank you!

  3. PFA Reader says:

    Very good article Sadie! You display and apply some good ol’ common sense which I admire very much. It’s just a real shame that more people cannot read & heed your advice… It would save many from a lot of headaches & heartaches!
    Thanks for the article and hang in there!

  4. Isabelle says:

    I have a cook book ‘More with Less’ and I decided to get the book ‘Living More with Less’, what you say here reflects what the contributors to these books say.

    Whether one lives below ones means because of religious beliefs or because it is simply common sense makes no difference. What is not generally accepted is that one has to be very, very poor before it is not possible to cut back. It may not be comfortable – but it is possible.

    I enjoy reading your contributions very much. They reflect my own view on life and it is a view that is standing those who hold it in good stead given the dire state of the economies of the world.

  5. Margo Gallinoto says:

    I have a limited number of carriers available in my rural area of TX, =for bundling phone, Internet, etc. However, the company was bought out and goes by the name Centurylink. They serve several states.

    I called them about making a few cost cutting changes. They then said there is a discount available for customers, but THEY HAVE TO ASK FOR IT!

    So, if you are a customer of this company, CALL ‘EM!! It may only save you $5 to $10 a month on your bill, but it all helps!

    I’d even call whatever phone/internet company you have, in case they have unknown discounts.

    Another call worth making is to your cell phone provider. They come out with new plans all the time. You can often get more for less if you call.

  6. KellyB says:

    Fantastic article. I lost my job last year, and we were able to get by without touching our savings by making a few of these same moves. Already living below your means and being able to cut back from day 1 is the key. I am now gainfully employed again and we learned a lot about our spending and what was truly important. Good luck!

  7. Jenn says:

    Nicely summed up. We too live way below our means by choice – on about 55% of our take home. The rest goes to retirement savings and knocking down the mortgage. I’m expecting to be laid off in the next month, and while it’s inconvenient to be sending out resumes when I’d rather have just continued on where I was, the whole thing doesn’t throw me into a panic.

    If I haven’t found a new job by the time it happens we’ll be just fine for 7-8 months without adjusting our basic spending which is already very frugal, and without counting any unemployment benefits. We’ll just temporarily suspend the savings/extra mortgage pmts and catch up on those once I land somewhere else. Because my company is in bankruptcy protection I won’t get a severance package or any paid notice, I’ll just be paid for any unused vacation. A few years ago that would have sent me into a panic. Now with no consumer debt, and our basic expenses pared down to a level we can just about cover on one salary we have a lot of breathing room.

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