There is no denying that the cornoavirus has eliminated much of peoples wealth. Especially hard hit are the Baby Boomers. Baby boomers own nearly half of privately-held businesses with employees in the U.S., according to Project Equity. Because of the pandemic “there was a 25% drop in the number of baby boomers who said they are self-employed or own their own business in the second quarter.” That impact affects 2.34 million businesses with 24.7 million employees and $5.1 trillion in sales, according to the U.S. Census Bureau.(Click here for more info)
“With businesses suffering and unemployment up, savings are falling accordingly. The number of boomers who report having retirement or savings accounts has declined in the crisis. According to the Center for the New Middle class, only 20% of nonprime boomers said they had retirement accounts, down from 36% a year ago. Even wealthier boomers saw savings drop, with 38% of boomers with prime credit ratings saying they have retirement accounts, down from 45% a year ago.”
There is no alternative for these Baby Boomers. Each and every one of them will have to adjust their living lifestyle and learn to live on less. Much less. Consider them the newest entrants to Low Income Living.
But what exactly is considered ‘Low Income Living”? It’s not poverty level, to be sure. Low Income ratios depend on where you live. “In San Francisco, a family of four with an income as high as $105,000 per year would qualify for Section 8 subsidized housing vouchers. In New York, Los Angeles, Boston, and Washington, DC, a family of four making more than $70,000 could qualify. That’s no guarantee, though, that families will get the help.” Click here to get more info.
Our retirement income fluctuates between $29,000 and $36,000 per year. It’s based on two Social Security checks, one pension check and interest/dividends off of our investments. In New York we would be considered slightly higher than a Lower Income couple. Because of the pandemic, my younger husband lost all of his income and was forced to take Social Security earlier than we had planned. That meant even less of an income than we were counting on.
So what do you do? We looked over our expenses and started cutting corners. There wasn’t much to eliminate but we did have a way to pay off two zero interest loans. By paying off $8171 in consumer debt we re-aligned our budget to meet expenses with income. Most of that debt was for home maintenance (we average $3600 a year in home maintenance) and for vacations (we average $3000 a year in RV vacations) We’re always going to have home maintenance costs (as long as we remain here) and we will always have vacations costs. How do we go forward and continue to pay for these two budget items? For us it was eliminating our monthly dependence on our interest and dividends. We decided to let those two accounts build up annually (which comes to approximately $5,000 a year) and channel those resources towards the deficit. That means we have to adjust our living expenses down to approximately $30,000 to $31,000. No more zero interest loans.
There’s a plethora of articles, books, blogs and YouTube videos outlining the negative and positive sides of living on less of an income, with more and more writings on the subject each and every day. Why? Because more and more people, not just Baby Boomers, are having to learn how to live on less and love (like) it! It isn’t because we didn’t plan well enough or save more enough. It’s the (pandemic) economy stupid and it looks as if it’s going to be with us for another year or so. Baby Boomers have it the hardest because they can’t find outside work easily enough.
Two of my favorite YouTubers are:
Tawra from Living On A Dime To Grow Rich (click here). Tawra and her mother Jill, always have great ways to save money. Both ladies are also the authors of a neat cookbook entitled: Dining On A Dime. I personally never bought their book but many of their recipes can be found on their website. For free.
The Prepper Princess is doing a whole new series on low income living. Princess just downsized her life to the extreme and touts living on $12,000 a year. Granted she’s single, has no children and a very scary dog. You can catch the Princess by clicking here and see how she lives happily below the poverty line.