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Living Well on Minimum Wage Challenge

By , December 9th, 2012 | 26 Comments »

dollar sign puzzle

Some of you know that my sister and I bet quite a bit. One of the bets ended up with me trying to eat well on less than $1 a day. It was a rather humorous look at my terrible cooking skills and what I was willing to do in order to save money on food over a 100 day period. Our bets often end up that way.

As I was visiting and we were talking about all the traveling I have done this past year, I told her that I really hadn’t spent all that much and that I could probably live my lifestyle on a minimum wage salary. She gave me her “I don’t believe a word you’re saying” look and audibly scoffed at my claim. Thus the newest bet was born — I will try to live well on the equivalent of a minimum wage salary for an entire year. Here are the rules (as laid out by my sister)

1. I have to spend at least 40 hours a week working at my job (she was worried that I would spend all my time finding ways to trick my way through this when real people have to work 40 hours a week). This should not be an issue — I usually work far more than 40 hours a week.

2. I need to live off of $17,160 for an entire year ($8.25 x 40 hours x 52 weeks)

3. I’m not allowed to use the government or charitable organizations to reduce my costs.

4. I can’t do other activities outside the 40 hours to raise more money so that I can spend more (no equivalents of taking on a second job or odd work so that I can increase the amount I spend to over $17,000)

5. If there is any dispute as to whether I succeeded or not at the end of this challenge, a vote by the readers will determine whether I was successful or not (my sister wanted the final vote, but we all know what that would have meant…)

6. Added here: I’m not allowed to spend more than a week with the same family member or friend per month.

I want to be clear from the beginning that I know that it is virtually impossible for those that are actually trying to live on a minimum wage salary to do what I will be doing. I have a ton of advantages that the average person doesn’t that I can tap into to try to make this work. This challenge shouldn’t be seen as an attempt to show that people earning a minimum wage salary shouldn’t be complaining (they should — I believe that anyone that is working 40 hours a week should be getting a livable wage), but to show that there are some amazing things that you can do if you are willing to be creative with your finances. I hope that ultimately this will show how thinking about things differently than most people typically do can open up your imagination to be much more creative with your own finances and how making choices that you may not have considered before can have a huge financial impact.

This should be quite interesting and I’m not 100% confident that I will be able to pull it off (there are plenty of unanticipated situations that could easily ruin the challenge quite quickly, and even if everything thing goes smoothly, I don’t plan on doing any less than I would have normally so I could very well fail if I don’t really think things through), but I think it will be a challenge that will get those reading thinking about how they spend money.

While this challenge won’t officially begin until 1/1/13, I am going to go ahead and start writing about it so I can begin thinking about preparations I need to do to make this possible and lay out my thinking for all of you to see (and comment on if you’s like — believe me, suggestions will be more than welcome). I hope that you join me for this journey and all the surprise and humor it’s bound to create…

Preliminary Basic Budget
Renting or Homeless?
Car or Carless
Frequently Asked Questions
Comfort Zone
Housesitting in Arizona
Love and Hate at CVS
Day One: A Well Stocked Fridge
Day Two: Risking Death To Save Money?
Day Three: First Difficult Choice
Day Four: The Importance of Living Well
Day Five: The Grand Canyon
Day Six: I Don’t Buy Gifts for Special Occasions
Day Seven: Leaving Places in Better Shape
Day Eight: Reevaluating Habits
Day Nine: Am I A Sucker?
Day Ten: Do I Really Have To Try To Date?
Day 11: Failing to Think Creatively
Day 12 & 13: Stupid Injuries
Day 14 & 15: Two Days of Hell
Day 16: I Have A Date
Day 17: Cooking Injury
Day 18: Near Money Disaster
Day 19: What’s A “Real” Date?
Day 20: $5 Down The Drain
Day 21: Clicking Clutch and Ghost Redwoods
Day 22: Doing More Than Is Expected
Day 23 & 24: TV Panic
Day 25 & 26: Car Repair Failure & Golden Gate Bridge
Day 27: Dull Razor Blades
Day 28: Not My Best Day
Day 29: Bye-Bye $485
Day 30 & 31: I Want That
Day 32 & 33: January Review
Day 34 & 35: Winning and Losing
Day 36: Unexpected Outing
Day 37: Fuzzy Head
Day 38: Paying More For Car Maintenance
Day 39: Free Hobbies and Vitamin D
Day 40 & 41: Gaining Weight
Day 42 – 48: Lost Week
Day 49 – 120: Lost Months
Day 121: My Boring Life

(Photo courtesy of Horia Varlan)

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  • Samantha says:

    Most people would have trouble with this challenge. I suspect you are not most people. I lived a year off just under $12k, and I was feeding and housing myself, my boyfriend and 2 elementary age children. I didn’t coupon at the time, but I was an adept stockpiler (I firmly believe that stockpiling saves me so much more money than couponing, though coupons do help). My grocery budget for that whole year was a meager $1k, and we ate really well.

    If you don’t already, you should write down every bill you have to pay monthly. Some things you’ll have some wiggle room with, some you won’t. Find the wiggle room. Raise your car insurance deductable, or better yet, get quotes and see if you can really save. Tweak the temp on the thermostat. Reconsider some of the fun stuff, and think of cheaper ways to have fun.

    We spent a lot of time at the library (we’re bibliophiles), did not have cable but we kept Netflix, and instead of trying to keep the house cool, we parked ourselves at the pool during the heat of the day.

    Frugal is a state of mind, and I’m confident you’ve got it.

    Best of luck.

  • creditcardfree says:

    Jeffrey, Good luck! That is quite a challenge. Being organized will help tremendously.

  • twest says:

    Good Luck with this challenge. I look forward to keeping up with you on this journey.

  • Katherine says:

    Sounds like fun! I’m rooting for you!

  • Good luck on this bet Jeffrey. I think it will be difficult, but if you are creative enought(you are!), I think you can pull it off. I can’t wait to follow it!

  • LuckyRobin says:

    Looking forward to seeing how this works out for you.

  • Mike says:

    I love the idea and good luck!! I have several suggestions that may help, but the one I would like to mention here is to make a lot of friends. When you are making minimum wage you have fewer options when trouble hits. Having friends that are willing to help you out (fix a leak, fix a flat, give you a ride, pick up your kids, lend you a nice clothes for a job interview, etc.) is invaluable.

    Most importantly, in order to make a lot of friends you have to be a good friend.

    • jeffrey says:

      I do have a set of very good friends, but I definitely don’t have a lot of friends (one of the hazards of being an introvert). They are definitely the type that I can count on if worst comes to worst (or even if it doesn’t), but I’m hoping that I don’t have to rely on them too much.

  • Wow, it’s amazing that you committed to doing this for a full year. I question whether things will blow up on you that will destroy your chances of success: I’m assuming you are a homeowner (I could be wrong about this, though, as I just started reading your site). What if you need a new water heater? What if you have a string of bad luck where your washer, dryer, furnace, etc. break and need replacement? I think the unexpected costs are the one thing that could really make this a difficult task.

  • Minny says:

    Samantha has given good advice, we had to live very frugally for three years and in many ways have never gone back. Once you have realised the amount of money simply wasted it is hard to go back.

    The living on $1 a day will help.

    What challenges do you set your sister?

  • Gailete says:

    Uh about the amount you will be living on, I believe you forgot to take out tax and social security, etc. that is normally gone from a paycheck before you even see it. What remains is what you have to live on, the NET not the gross. Even if you think you wouldn’t have taxes taken out, for sure you will have state taxes, local taxes and the SS/MC amounts gone. Your 40 hours of work a week should be spent in active physical work since that is also the type of work most people do for that money–the harder most people work the less they earn. If you think of writing your blogs and newsletters etc, as work, you might want to oomph that up to something very physical.

    I will watch this challenge with interest as I have done this myself only for me it was out of necessity. I lived on a minimum wage Part-time job and supported myself until I was bumped up to full time, still minimum wage and then got a nickle an hour raise–big woop!

    • jeffrey says:

      I have taxes listed in my preliminary budget and know that I will have less than the whole $17k to spend.

      As I mentioned, while I will be living on the same amount of money, the challenge is not likely to look anything like the typical minimum wage earner and I have many advantages that the typical minimum wage earner doesn’t. This will be more about creative use of finances to show it’s possible to do quite a lot without spending a lot with creativity.

  • Ericka says:

    Cool! I love tracking your challenges! Good luck!

  • Dee in RI says:

    I’m glad you’re doing this challenge. I’ll follow this one as I did the $1 a day challenge. Good luck with all.

    Notes: Minimum wage varies from state to state and so does the cost of living in each state (rent, taxes, etc.). I believe that $8.50 an hour is the highest minimum wage in the country. And you lose some of it to payroll deductions. Most real minimum wage workers would not be able to crash with friends for a week at a time. Their likely choices would be living in a vehicle (if they have one), a rooming house, or if they are lucky, section 8 housing.

  • Good luck on your challenge, family of 5 here and we live off of one wage minimum wage salary. $7.45 here and for quite awhile did it without government assistance which I did recenty have to accept as I have a very real life threatening illness going on right now. If not for my illness I would have continued doing it without help.

    We pay rent in a cheap rural area, we never would have anyone who would put us up for a week, that is a lot easier when you are single.

    I look forward to following your challenge and seeing how you do it 🙂 best of luck to ya!

  • Christy says:

    This is a great idea. We Americans waste too much including money. This is an inspiration for us to create our own challenges.

  • Amber says:

    Good luck, I think I’m going to try this for February

  • Nikki says:

    Did you finish the challenge? I see the last entry was in June 2013.

  • Nicky says:

    Good Job, Strong Individual


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