How I Live on Less Than $40,000 Annually: Ruth from Kansas

With financial discipline, a family with four kids and a stay-at-home-mom can live very comfortably on less than $25,000 per year in Kansas.

My name is Ruth and I’m a stay-at-home mom for our four kids. When our first child was born, I vowed to stay home as long as we could afford it. It’s been 16 years and three more kids since then, and I’m still here.

I was always very frugal, living within my means, avoiding debt and dabbling a little with mutual funds. Most of this I learned from my frugal, prosperous parents who have never flaunted what they have. I was fortunate in that my parents paid for my undergraduate education, so I was never strapped with student loan debt. When I moved back home from college, I started my first job with only 41 cents in my checking account — but I had no debt.

My husband, who works as an electronics technician, was the youngest of seven children in a very poor family. As I understand it, his mother probably could have fed an army with little more than dirt. When we met, his only debt was on his car, which he paid off around the time we got married.

We’re currently debt-free.

Our Household Expenses

Seven years ago, we paid off the mortgage for our very-average four-bedroom house on one acre, in one of the best school districts in the state. Property taxes and insurance run us about $240 per month.

Our electricity, gas, water and telephone are approximately $300 per month. We also pay $120 per month for Internet, cable and house-phone service.

I’ve really let our grocery expenses go lately; they currently run between $500 and $600 per month. (Oh, the days of being able to feed our family for under $250.)

On average, we spend about $100 per month on gasoline. We’re a one-vehicle family, sort of. We have a minivan that I drive most of the time. We paid for it in cash, of course. We are very fortunate in that my husband’s employer provides a vehicle for him to use for work purposes, including driving to and from home.

Our oldest child is learning how to drive and we’re considering buying another vehicle in the near future, when and if we find the right deal.

Our family health insurance through my husband’s employer is $65 per month. It used to be zero, but we have absolutely no room to complain. Most of our doctor visits have a $15 co-pay, and we pay 20% of bills up to the deductible. Our highest out-of-pocket health expense is for eye care, since four out of our family of six wear glasses. So far, our family has been blessed with good health.

We also contribute money each month towards our savings and retirement accounts, as well as our kids’ Educational 529 accounts.

Between our checking and savings accounts, our emergency fund adds up to about $55,000. This is probably more than it should be, but I like to feel comfortable with a nice cushion.

Overall, our household expenses run somewhere between $20,000 and $25,000 each year.


We are a family of mostly introverts, so we don’t get out that much for entertainment. About a year ago, when our Internet connection desperately needed upgrading, we finally caved in and got cable TV with one of those package deals, but I’m not impressed with it.

My kids play more video games than I want to admit.

We’re active in our church, which includes many camps for the kids and the whole family.

A few years ago, while my husband was a reservist stationed in Florida, we spent several weeks of the summer with him and did the rounds at all the big amusement parks. Yes, it was expensive, even with the generous discounts for military. Most of the time we take weekend road trips closer to home.

Managing the Finances

After our first child was born, I started reading about frugality and personal finance. Okay, I did a LOT of reading. I think I read every book in the personal finance section in the library, and then some. This helped me to hone a lot of skills related to both reducing expenses and investing wisely. Now I write about it at my own blog, Mother Frugal.

As far as managing our household finances, my husband has no interest in it so he lets me run the show. He determined an “allowance” that is automatically withdrawn from his paycheck to his account — the rest goes to my account from which I pay all of the bills. We still have the same checking accounts as before we met. For estate planning purposes, we’re both listed on these accounts, but we each manage our own.

Most of the time, our accounts are fairly equal after all has been paid. If they become really uneven, we’ll do a transfer, but that has rarely happened. It works for us.

We’ve never really had a formal budget, but I do keep track of nearly every penny we make and spend on a spreadsheet, so maybe there is an implied budget there. When you know where you’ve been and where you are, it’s pretty easy to know where you’re going.


If you’re a household CEO who is successfully making ends meet on roughly $40,000 per year or less, I’d love to hear from you. Contact me at and be sure to put “$40,000” in the subject line. If I publish your story, you’ll get a $25 gift card!

Photo Credit: Roy Montgomery


  1. 1

    Cindy L. says

    Ruth, I loved your story! You are doing a wonderful job!

    Isn’t amazing how much we can get for so relatively little if we’re willing to live within our means? :-)

    • 2


      Cindy, Thank you!

      Yes it is amazing. We did without a lot while paying down our mortgage, but we never felt like we were suffering, either. Now, it feels like the sky’s the limit.

  2. 3

    Gene says

    It just goes to show, a big part of living large (relatively speaking) on a small budget is location, location, location.

    Keep up the good work.

    • 4


      Gene, there is no question about it. Part of our success is that we live in one of the most affordable areas of the United States. Kansas is really a great place to live and raise a family.

  3. 5

    Pepper says

    Hi Ruth! Thanks for sharing your story. How long did it take you to save $55,000 in your emergency fund. That is a lot of money!!! I’ve got $3000 in mine and it seems like it has taken me forever to get there.

    How old are your kids? ALso, how old is your minivan and did you buy it new?

    • 6


      Hi Pepper! Our mortgage payoff seven years ago left us with about $4000 in our emergency fund, so it has grown to what it is since then. A big chunk of our savings happened while my husband was deployed and our income was temporarily increased. Our expenses stayed about the same, so we just padded the emergency fund.

      Our kids are 15, 13, 11 and 7. How dare they grow up so fast…

      Our minivan is a 2008 that we bought in ’09. We bought it from a reputable salvage yard. The previous owner reported it stolen, collected the insurance money, and then the van was later found, completely unscathed. Because it is still considered a “salvaged” vehicle, we saved about $10,000 on it. We plan to drive it until it drops, just like our previous one.

    • 8


      Jon Jon, thanks for asking this! I hope to write more about this in my blog sometime.

      The two books that absolutely influenced me the most are “Your Money or Your Life” by Joe Dominguez and Vicki Robin, and “The Complete Tightwad Gazette” by Amy Dacyczyn. These books were first published in the nineties, so some information is outdated. The philosophical stuff, however, is timeless.

      There are sooooo many other personal finance books out there that I also like, but probably don’t have enough room to include here. I don’t agree with everything that everyone writes (including the ones I mentioned), but each book has contained something worthwhile to consider. Just take what tidbits of information you think would work best for you.

      • 9

        Jon Jon says

        Your right. There are a lot of books out there it’s hard to know where to begin. Have you read “The Millionaire Next Door” and if so what did you think of it?

        • 10


          “The Millionaire Next Door” is an excellent one. It gives a big slap-in-the-face to how our society perceives wealthy people, by giving empirical evidence of how they REALLY live. It’s not so much of a “how-to” book, but eye opening nonetheless. Yeah, I’d recommend it!

  4. 11

    Anna says

    Ruth: Congratulations on managing your finances so well! You are truly blessed to be able to live as you do on so little money and still be a stay at home mom to your kids.

  5. 15

    Winston O Boogie Jr says

    $55000 in emergency savings is VERY impressive. Are you still contributing to your emergency fund, or have you stopped?

    If I were in your position I would take the money I was directing toward the emergency fund and spend at least some of that on discretionary stuff.

  6. 16


    Thanks Winston. Since we live well within our means, our “contribution” is just whatever remains after all has been paid. So in a sense, I guess we are always contributing to it. We do have a few large expenses that we anticipate in the near future, like the car I already mentioned, a replacement for our 20+ year-roof, driveway repairs, and such. I would like to be able to pay for things like these while still maintaining a nice cushion.

  7. 17


    Len, I love this series!!
    Ruth, the details really flesh out the reality that it is possible to live a “wealthy” life for less than $40K. Although living in middle America makes it a bit easier.

    • 18

      Len Penzo says

      Thank you, Barb, but I owe it all to my very responsible readers. I mean, come on … Ruth is on fire! Four kids, a stay-at-home mom, owns her own house and does it all for $25k or less? Amazing!

      OK, I guess I should use this as an opportunity to ask anyone else who would like to share their household CEO skills with the rest of us to please send their story to

      Thanks, everyone! :-)

  8. 19

    JD says

    I enjoyed this very much, but I had a question: Did I get this correctly? Insurance is $65 a month? Mine (employee + spouse)is almost $400 a month, with a $25 copay for doctors, $40 for specialists, $30 per cheapest prescriptions, $750 a person deductible and this is through work — private insurance is higher than that, and we can’t get it privately anyway. The highest deductible plan offered at work was still over $300 a month, and would have been a poor choice for us as I have a spouse with a chronic condition . Was that supposed to be $65 a week?

    • 20


      JD, I had to relook at my hubbie’s pay stubs, just to make sure. We pay $30 per bi-weekly paycheck, which calculates to $65 a month. Having heard so many nightmare stories about the costs of health care and insurance, I realize how fortunate we really are.

  9. 21

    david says

    yea I got a question….. I net 980 every two weeks and my wife nets approximately 700 a month we have 2 children 4 and 7 how the heck are we supposed to make ends meet? rent is 800/ groceries are 200/week, insurance 170/month, oil heat during the winter… approx 400/ month, electric 200/month…. and so on and so forth… had some debit/obligations prior to getting laid off then found my current position. and due to credit problems and such it is nearly impossible to find a cheeper place to live let alone come up with the security/first months rent!!!! sooo lost and confused.

    • 22

      grannyfrugal says

      David, did you read the entire article? How can you and your wife (and two small children) spend $200 per week on groceries when the author of the above article is spending a maximum of $150 per week for a family of 6 including two teenagers? Looks like your your grocery bill could use some serious trimming. The fact that you are reading this website is a good start.

    • 23

      Jared says

      Not just groceries, but your utility bills as well. My wife and I live in Buffalo NY, and just bought a house, moved in on January 1st. It is a 950 square ft cape cod built in 1953, with subparagraph insulation in the attic (which will be a project this spring). Nonetheless, we are averaging $104 a month for gas, and $49 a month for electric. February was the coldest month in Buffalo history, and we paid $108. What do you keep your heat at? Ours is at 60 when we are at work and when we are sleeping (which most sleep specialists recommend anyway), otherwise 68. We only have lights on when we are in a room, and keep electronics unplugged when not in use (most modern day stuff sucks power even when off). $600 for heating and electric seems really high.

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