A few weeks ago on the podcast I had Josh Gordon of the Non-Conformist family as a guest. We talked about a variety of topics such as how he and his family live on about $2,000 a month. What really stuck out to me in that interview was when Josh described how he and his wife actually sat down and determined what their minimum amount of income they needed to live on for a month.
After hearing Josh share his experience in doing that, I realized that everyone should figure out what their minimum number is. What exactly should be included in your minimum number you might ask? Well first, start by including your four walls: food, housing/utilities, transportation, and clothing. Then include other monthly necessities including your insurance premiums and your minimum debt payments. You may then include a few other “fun” things, but mostly this is a bare-bone minimum of what it would take for your family to live on.
After calculating your minimum number the results may be quite surprising. You might be relieved to know that you could make it on such a low number that it actually takes some weight off your shoulders, knowing that you could survive a dip in income. On the other hand, if you have a lot of debt your minimum number might be a little bit higher than you would like and could be closer to what your take-home pay is currently. In that case you can use that as motivation to get serious and knock out your debt. Go ahead, sit down tonight and determine what your number is. Whatever it is, use that number as motivation to improve not only your finances, but also your quality of life.
So what’s your minimum number?