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Setting spending priorities when income falls

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If you are faced with reduced income or increased expenses, you can adjust or develop a spending plan to help pay your bills. If your income will be affected for the long term, you can modify your spending habits to fit your current family finances. 

Be realistic

During income loss, people often have difficulty being honest with themselves and others about their financial situation. Avoiding your problems can be destructive. The worry and stress caused by financial uncertainty may be worse than the problem itself. It's important to look realistically at your situation and actively seek solutions to your problems, even if it is uncomfortable.

Spending decisions affect the whole family 

You need to talk with all family members about the situation. Let them know the family needs to change its spending habits and involve everyone in setting priorities.

When family members understand the tough choices that must be made and have a voice in making decisions, they will be more willing to accept the decisions.

As family members talk about what is most important, be sure to listen to what they say. Supporting each other can help you pull together as a family and get through these tough times.

Get control over your finances


Related resources

America Saves — Includes information for families on how to save and build wealth.

My MoneyFederal Financial Literacy and Education Commission — Website dedicated to teaching all Americans the basics of financial education.

Reviewed and revised by Sharon Powell and Sam Roth, Extension educators
Originally authored by Sharon M. Danes, retired Extension specialist and professor in family social science

Reviewed in 2023

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