Wednesday, 6 July 2011

Living on a meagre income... it's easy

The current economic climate means that we seem to be in a double dip, if not a flat lining, depression of economic activity. This means that we are seeing another round of cost-cutting by all companies. This has forced me to look again at the management of my household finances, but as I  have posted before, this is an opportunity, not a hardship. This is the scenario where M.S.ex comes into its own as we battle economic forces.

I have to make a creative method of generating cash whilst maintaining the income flow from my part-time job, which keeps me semi-retired.

The way in which I will look at this is as follows:

Assess all finances to the nth degree, ensuring that income can cover expenditure;

Generate ideas for cash creation without having to resort to further, paid employment.

Assessing my finances has become easy over the years, as I have only one bank account, shard with my wife, and she has her own.
This makes it easy to check all outgoings, as all non-essential outgoings have been removed.

The figure I would use to ensure a very modest standard of living is £7000 per annul.

This means I have to have an income of £7000 x .25 to cover taxes, i.e. £8750

If I look at my current situation, I can easily cover this.

This may seem rather extreme, but if my income improves, then I Will have more cash to invest for my early retirement goal. If it doesn't, then I know I will still be able to cover my families expenses.

The purpose of money saving extreme, is  to indicate how everyone can get into this position, and protect themselves from market forces/ the consumerist trap.

Thanks for reading.

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