Welcome to Real Money Wins, a new series from the Dave team featuring our members’ experiences overcoming money challenges in their own words. If you’ve ever felt like most personal finance advice is coming from people who already have 4+ zeros in their bank account, then this is the place for you. Read on for our members’ take on the best personal finance moves and advice that make managing money a little easier when real life gets, well, real.
This Real Money Wins story comes from Michelle, a Dave user based in Pasadena, TX. All stories in the series are written as told to the Dave team. Names may be changed to protect our members’ anonymity.
My husband’s a truck driver and his job is affected by the weather. The past few months we had a season of heavy rain and he couldn’t work. In the winter in the south we get a lot of rain. Where we are we don’t do snow we do rain. When he lost his job, we had to pay for everything with one income.
I work as an office manager, and we don’t have kids. Our expenses during this time were higher than our income.
As hard as this time was, that season instilled a little more discipline in me. I learned how to get by on less and I learned lessons that I still follow even now that he’s started to work again.
While he was out of work, we didn’t ask for help. We didn’t turn to our families. I think I struggled with it more because I’m the one who manages the money — I see it coming in and coming out. I’m the one who wonders, “how are we going to pay for this, how are we going to pay for that?”
It was a good five months that he was out of work. Then he had work but the owner of the company he worked for was not a very good business owner. Finally he started driving with another company and this one has been a lot better.
Pay cash for your “wants”
When your expenses are higher than your income you learn: If I don’t need it then I’m not going to get it. Identify what is essential and what’s not, and never use credit for something that’s a want. If I want something I’m going to pay cash. If you put it on credit you end up paying extra money for it. There’s a watch my husband wants and we follow that rule — if he wants it he has to pay cash.
Find alternatives to your “little luxuries”
The hard thing for me during this time was giving up my little luxury — shopping. I found other ways to get my fix though. I learned how to thrift shop and go to consignment stores. If I wanted something I learned how to make it myself. If I wanted something for the house I learned to DIY. I put shelves up with refurbished wood. Someone threw away a good mirror. I saw them throw it away and decided to sand it down and reframe it.
Live on 70%
In order to be comfortable, we need to live off of 70% of the income that we brought in. If our income fluctuates we can have a cushion. If something happens then you know — I’m still okay. It’s harder for him to live on 70% and not spend all of his money. But if you stick with that rule and save the rest you’ll have savings, an emergency fund, and money to take care of medical bills. You can feel comfortable going by that 70% rule.
Save — even if it’s just a little bit
During this time I learned you have to have six months of expenses saved. My advice is to start putting $25 per paycheck away. I have been really consistent with that. I have to have a savings and emergency fund for them.
It’s really challenging in the sense that I know the money is there and I can’t use it but I want to. So you need savings and if someone has a longterm medical condition, they need a savings account for medical expenses.
There’s always a better deal
When my husband was out of work we took another look at all of our expenses. I learned how to negotiate down credit card debt. Another thing people forget about is checking your car insurance. We cut down $30 on insurance by switching providers. We switched banks. I have family that are in the military so I use the military credit union and don’t pay fees.
My husband doesn’t have healthcare through his job and he has high blood pressure so he needs medication and regular medical care. I learned that some clinics take care of walk-ins for $35 and lab work is $120. It’s much cheaper than if we went to the regular hospital without insurance. If you go to Sam’s Club and get a premium membership you can use the membership to get better rates for prescriptions. At Walgreens and Krogers his prescriptions are over $100. We pay $30 for a 90 day supply. We don’t have thousands to spend, so we’ve had to learn how to save money on medical expenses.
How Dave helped
If we were really short, we could use the Dave advance to put money towards groceries or to put towards a bill we forgot coming through. They get it to you that day so you don’t have to wait. It helped when we needed money for gas and food. What I like about it is that it’s not like payday loans. It’s a small amount to get you by but you’re not struggling to repay it.